Keyera (TSE:KEY) executives said 2025 marked a “transformational year,” highlighting record results in its fee-for-service businesses and a slate of sanctioned growth projects, while also outlining the expected financial impact of an unplanned outage at its Alberta EnviroFuels (AEF) facility.
Record fee-for-service performance and year-end metrics
President and CEO Dean Setoguchi said Keyera “continued to demonstrate the strength of our fee-for-service business,” with record results in both Liquids Infrastructure and Gathering and Processing, driven by higher utilization across its integrated system.
Marikar said the company’s fee-for-service segments delivered record results year over year:
- Gathering and Processing: record annual realized margin of CAD 439 million, up from CAD 413 million in 2024, driven by higher throughput and growing contributions from the Wapiti and Simonette gas plants as contracted volumes grew.
- Liquids Infrastructure: record realized margin of CAD 593 million, up from CAD 558 million in 2024, supported by higher storage contracting, increased utilization of the condensate system, and a “steady ramp-up” of KAPS volumes.
Marketing results and guidance timing
Management described marketing as a strategic differentiator, but one that can be volatile. Setoguchi said the marketing business finished 2025 “at the top end” of revised guidance, though below the company’s long-term base expectations.
Marikar said marketing realized margin was CAD 300 million in 2025, compared with CAD 485 million the prior year, “mostly” reflecting lower premiums and volumes for isooctane sales.
Keyera said it will provide 2026 marketing realized margin guidance with first-quarter results in mid-May, following the end of the NGL contracting season. Marikar added that previously disclosed guidance would reflect an approximate CAD 110 million impact tied to the unplanned AEF outage and turnaround.
When asked about the effect of lower crude prices on blending margins, Liquids Business Unit SVP Jamie Urquhart said crude prices affect multiple components of the marketing business. He added that Keyera’s ability to meet its guidance depends on core commodity-price assumptions and the expected operation of key assets, including AEF and fractionation capacity, and said the company remained confident it would be within guidance “even in today’s current commodity environment,” assuming assets perform as expected.
Growth projects, portfolio moves, and Plains acquisition
Setoguchi said Keyera sanctioned three “highly strategic and capital-efficient” growth projects in 2025, including two fractionation expansions at KFS and KAPS Zone 4. He said the projects are “highly contracted” and intended to support growth in fee-based cash flow.
The CEO also pointed to two portfolio actions: acquiring additional gas plant capacity in the Simonette area and divesting the “non-core” Wildhorse asset. On the call, management declined to provide transaction-specific financial details regarding the Simonette deal, citing confidentiality provisions with a private producer, but Setoguchi said the investment met Keyera’s 10% to 15% return on capital threshold and included some downstream services.
Setoguchi described the Wildhorse sale as consistent with Keyera’s strategy of focusing on its Canadian integrated NGL value chain. He said the company is not a major crude-handling service provider in the U.S. and lacks “big competitive advantages” there, while Plains could make the asset “much better and more profitable” due to its footprint in Cushing. He also referenced prior divestitures, noting the company sold three gas plants last year (North Pembina, Caribou, and Edson) as part of an effort to recycle capital and reduce the burden of non-core assets.
Keyera continued to discuss its pending acquisition of Plains’ Canadian NGL business, which Setoguchi called “transformational.” Management said it expects the transaction to close around the end of the quarter, while noting timing is not fully within the company’s control due to the regulatory process. Setoguchi emphasized that Keyera and Plains must operate as separate entities until closing and said there are no combined-service discussions with customers prior to completion.
Marikar said capital allocation priorities beyond the dividend include funding Keyera’s sanctioned growth program and repaying debt to return leverage to the low end of its target range, calling low leverage a competitive advantage.
AEF outage, basin outlook, and organizational changes
Setoguchi addressed an unplanned outage at AEF, announced in mid-January after an issue was identified with a vessel on site. He said safety and facility integrity remain top priorities and that repairs are underway, with expectations for a return to full production in May. Urquhart said an investigation is underway to determine root cause and that, while offline, the company is taking a proactive approach by inspecting major accessible components to support long-term integrity.
On the broader outlook, Setoguchi reiterated Keyera’s expectation for 7% to 8% fee-for-service EBITDA growth through 2027, pointing to take-or-pay contracting and contributions from projects including KAPS Zone 4 and Frac III beyond 2027. He also cited macro factors supporting Western Canadian growth, including LNG Canada volumes, potential momentum toward additional LNG sanctioning, data center-driven gas demand, and pipeline expansions affecting condensate demand.
On condensate, management emphasized Keyera’s role in the diluent market. Setoguchi said the company has an “industry-leading condensate system” that provides storage, aggregation, and deliveries to the oil sands, with the ability to rail condensate when needed. Urquhart said Keyera’s system handles about 70% of the condensate used in the oil sands and that the company has identified opportunities across storage and other system components as demand grows. Management said it is evaluating debottlenecking options proactively.
Keyera also outlined recent organizational changes made ahead of the Plains transaction. Setoguchi said the company reorganized into two business units supported by existing enablement teams, with Brad Slessor leading the G&P and NGL Pipelines Business Unit and Urquhart leading the Liquids Business Unit, which includes Liquids Infrastructure assets and the marketing business. Management said these changes do not affect segment reporting.
About Keyera (TSE:KEY)
Keyera is a midstream energy business that operates primarily out of Alberta, Canada. Its primary lines of business consist of the gathering and processing of natural gas in western Canada, the storage, transportation, and liquids blending for NGLS and crude oil, and the marketing of NGLs, iso-octane, and crude oil. The firm currently has interests in about a dozen active gas plants and operates over 4,000 km of pipelines.
