Pembina Pipeline Acquires Whitecap Resources' Working Interests, Inks New Long-term Agreements

Pembina Pipeline Corporation has announced that Pembina Gas Infrastructure Inc. (“PGI”), a leading gas processing entity in Western Canada co-owned by Pembina and KKR, has entered into a purchase and sale agreement with Whitecap Resources Inc. ("Whitecap") to acquire a 50 percent working interest in Whitecap’s 15-07 Kaybob Complex (the “Kaybob Complex”). Additionally, PGI has signed an agreement to assist in the future infrastructure development of Whitecap’s Lator growth area (the “Transaction”). The gross proceeds from the Transaction amount to $420 million ($252 million net to Pembina).

“Our ability to provide distinctive and value-added solutions for Whitecap's growth in the Montney and Duvernay regions underscores our competitive edge and why clients select us," remarked Chris Rousch, President & CEO of PGI. "These regions hold substantial growth opportunities, and we are honored to serve as Whitecap’s infrastructure partner. This transaction further demonstrates Pembina’s integrated value chain's capacity to meet our customers' expanding needs.”

Transaction Details

• PGI is set to obtain a 50 percent stake in the Kaybob Complex, featuring a natural gas processing capability of 165 million cubic feet per day and a condensate stabilization capacity of 15,000 barrels per day. Whitecap will retain operatorship of the assets. Whitecap will enter into a long-term take-or-pay agreement for PGI’s capacity in the Kaybob Complex and commit to an area of dedication to PGI for all volumes produced in the area.

• PGI will finance the development of Whitecap’s Lator area, including new battery and gathering infrastructure (the "Lator Infrastructure"), which PGI will own. In exchange, Whitecap will enter into long-term take-or-pay agreements with PGI for priority access to the Lator Infrastructure. The development in the Lator area also designates an area exclusively for PGI, covering all volumes produced there.

• Whitecap has also secured additional long-term take-or-pay agreements with PGI at the Musreau gas plant in the Cutbank Complex (“Musreau”) and the K3 gas plant.

• Apart from PGI's transaction, Pembina has entered into a mix of new and extended long-term agreements for integrated transportation, fractionation, and marketing services with Whitecap. This includes a commitment to future growth volumes from Whitecap's Kaybob and Lator developments.

Strategic Benefits

• Aligns PGI and Pembina with a High-Growth Company: Whitecap, a leading Montney and Duvernay producer in Western Canada, has an exceptional growth track record.

• Enhanced Asset Utilization: The transaction will boost volumes at PGI’s Musreau and K3 facilities, optimizing existing capacity.

• Increased Volume Capture: The Lator Lateral will link PGI’s Musreau facility to the Lator area, enhancing PGI’s potential to capture additional volumes.

• Robust contractual safeguards: The current assets and upcoming infrastructure projects will benefit from dedicated area commitments and long-term take-or-pay agreements.

• Benefits throughout Pembina’s value chain: In addition to the acquired infrastructure and forthcoming PGI developments, the transaction enhances Pembina’s integrated operations. New and extended long-term agreements for transportation, fractionation, and marketing services, along with a dedication of future growth, will enhance utilization of Pembina’s Peace Pipeline and the Redwater Complex, including the under-construction RFS IV. Additionally, the arrangement for Whitecap's Lator development includes deep cut processing and ethane-plus NGL transportation and fractionation, supporting Pembina's ethane supply commitments.