Spectra Energy Corporation (SE) has signed a multi-year agreement with Progress Energy Resources Corporation. As per the agreement, Spectra will offer a total of 370 million cubic feet per day (MMcf/d) of natural gas gathering and processing services. These services would facilitate the growth of Montney production in Progress' core development area in northeast British Columbia. Financial details of the agreement were not disclosed.
Besides the renewal of the current contracts, it includes new services for 210 MMcf/d of natural gas. The deal allows Spectra to continue supplying natural gas gathering and processing to a large extent of Progress' incremental production in the area.
Spectra is the chief supplier of natural gas gathering and processing services in the Montney play with a network of more than 1,367 miles (2,200 kilometers) of gathering pipeline and interests in ten processing plants which have a capacity of more than 1.5 Bcf/d of gas processing.
Progress will receive these gathering and processing services at Spectra Energy's Highway, Jedney and McMahon facilities, as well as through the reactivation of the Aitken Creek Gas Plant.
The Montney play is located in northeast British Columbia, Canada and extends into Alberta. It is a superior unconventional natural gas resource estimated to contain approximately 450 trillion cubic feet of original gas in place. With the demand for unconventional resource plays gaining impetus companies are gearing up to stay with the flow.
Spectra’s growth momentum continues with both organic as well as inorganic means. The company also has a 50% ownership in DCP Midstream, one of the largest natural gas gatherers and processors in the United States.
Spectra holds a Zacks #3 Rank which translates into a Hold rating for a period of one to three months. For the long term, we maintain an Outperform rating on the stock. AT&T Inc (T) and Southern Company (SO) are major competitors of the company.
SPECTRA ENERGY (SE): Free Stock Analysis Report
SOUTHN COMPANY (SO): Free Stock Analysis Report
AT&T INC (T): Free Stock Analysis Report
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment