Calgary-based AltaGas Ltd. has sanctioned the Pipestone Natural Gas Processing Plant Phase II expansion project in the Alberta Montney Shale region.

Construction is set to begin this year on the expansion, which is fully permitted. The project would provide an additional 100 MMcf/d of sour deep-cut natural gas processing capacity and an additional 20,000 b/d of liquids-handling capabilities, according to AltaGas. 

AltaGas announced the final investment decision (FID) for the project late last month upon closing its acquisition of the existing Pipestone processing complex and adjacent Dimsdale gas storage facility from Tidewater Midstream and Infrastructure Ltd. for C$650 million ($487 million). The asset package also included the Pipestone condensate truck-in/truck-out terminal...