Dec 8 (Reuters) - Canada’s Keyera Corp said it will buy Alberta EnviroFuels, an iso-octane manufacturing business jointly owned by subsidiaries of Finland’s Neste Oil Oyj and Chevron Corp, for $198 million.
The deal, which includes a 13,600 barrel per day iso-octane manufacturing facility and sales contracts with major refiners, is expected to close early next year, Keyera said in a statement.
Iso-octane, a key requirement for Keyera’s natural gas liquids business, is a low emission, high octane gasoline blending component derived from butane.
Alberta EnviroFuels -- the largest iso-octane manufacturing facility in the world -- ships the component to Chevron’s Burnaby, British Columbia refinery and to customers in California.
Calgary-based Keyera, which operates one of the largest natural gas midstream businesses in Canada, expects maintenance costs of about C$6-C$9 million per year. (Reporting by Gowri Jayakumar in Bangalore; Editing by Viraj Nair)