By Paul Vieira
OTTAWA--Canada's antitrust watchdog said Tuesday it is seeking to quash Keyera's proposed deal for Plains All American Pipeline's Canadian natural-gas business.
The Competition Bureau said the planned $3.7 billion transaction would reduce competition at a crucial natural-gas liquids processing hub in Fort Saskatchewan, Alberta. The bureau said Canadian producers rely on that hub to bring product to market.
The deal would reduce the number of major integrated service providers at the hub from three to two, "limiting producers' choice among providers for processing services and weakening competitive discipline in contract negotiations," the bureau said.
The bureau has filed an application to the Competition Tribunal for an order "to preserve competition in the processing of natural gas liquids at the Fort Saskatchewan hub." The tribunal is similar to a court, and hears applications made by the antitrust watchdog.
Representatives for Keyera and Plains didn't respond to requests for comment.
Keyera's planned takeover would establish a natural gas liquids corridor in Canada for the company, with assets that include extraction, fractionation and storage operations, as well as rail and truck terminals in Alberta, Saskatchewan, Manitoba and Ontario. The company has said the move would allow it to be more competitive in the services it offers and in terms of reliability, while bringing an opportunity to cut costs.
Tuesday's move follows the Competition Bureau's filing last month for a court order, to allow the agency to gather records in its probe of the Keyera-Plains deal. Despite that move analysts at Raymond James were confident the deal would close in May.
In March, Keyera and Plains said that the planned deal was taking longer than anticipated.
Write to Paul Vieira at paul.vieira@wsj.com
(END) Dow Jones Newswires
05-05-26 1002ET
