Backgrounder: Competition Bureau challenges Keyera’s proposed acquisition at a critical Canadian energy hub
Backgrounder
May 5, 2026
On this page:
- Overview
- The natural gas liquids industry
- Competition concerns
- Remedies sought
- Next steps
- Additional information
Overview
The Competition Bureau has applied to the Competition Tribunal to challenge Keyera Corp.’s proposed acquisition of Plains All American Pipeline L.P.’s (Plains) Canadian natural gas liquids (NGL) business.
Natural gas liquids processing, which includes fractionation and storage, is a critical part of Canada’s energy economy, supplying products used to heat homes, support agriculture, and manufacture petrochemicals, while enabling Canadian producers to participate in domestic and international markets.
Following an extensive investigation, the Bureau concluded that the proposed transaction is likely to harm competition in natural gas liquids processing at Fort Saskatchewan, Alberta, Canada’s primary hub for these services, which Canadian producers rely on to bring product to market.
This backgrounder provides additional context on the natural gas liquids industry in Canada, explains the Bureau’s concerns related to the proposed transaction, outlines the remedies sought in the application, and describes the next steps in the process.
The natural gas liquids industry
The role of natural gas liquids in the Canadian economy
Natural gas liquids are byproducts of natural gas production. Before producers can transport and sell natural gas, they must separate NGLs from the gas stream. Producers typically need fractionation services to convert NGLs into specification products such as propane, butane, and condensate.
For producers, access to competitive and reliably priced NGL processing services is critical to efficiently bring production to market.
Integrated energy infrastructure
Producers bring natural gas liquids to market by relying on a network of interconnected infrastructure. This network typically includes:
- pipelines that transport NGL mix from natural gas production areas,
- fractionation facilities that separate the mix into specification products,
- underground storage facilities, and
- rail and truck terminals that connect products to end markets.
Illustration of the natural gas liquids value chain.
Firms develop this infrastructure over many years, invest significant capital, and rely on specific geographic or geological conditions to operate effectively. As a result, a relatively small number of firms operate large, integrated systems. Access to this infrastructure determines how firms compete in the NGL industry, shaping the competitive landscape that producers face.
Fort Saskatchewan is Canada’s primary natural gas liquids hub
Fort Saskatchewan, Alberta, serves as Canada’s primary hub for natural gas liquids processing. The area hosts major fractionation facilities, extensive underground cavern storage, and pipeline, rail, and truck connections that link producers to domestic and export markets.
Because of this unique concentration of assets and connectivity, producers across Western Canada rely on the Fort Saskatchewan hub to process NGLs into specification products, and to store and market those products. Competition among fractionation and storage providers at the hub influence prices, contract terms, service quality, and decisions to invest in new or expanded infrastructure. Together, these factors shape how NGLs move through Canada’s energy system.
Map of pipelines to Fort Saskatchewan, which run from and along gas processing facilities. Keyera, Plains and the third major integrated natural gas liquids processing company, Pembina, own and operate the primary pipeline systems in the area.
Competition concerns
The proposed transaction would eliminate a close competitor
The Competition Bureau found that Keyera and Plains compete closely to provide natural gas liquids processing services at the Fort Saskatchewan hub. Both firms offer integrated NGL processing services and compete to enter service contracts with producers.
By eliminating Plains as an independent competitor, the proposed transaction would reduce the number of major integrated service providers at the hub from three to two, limiting producers’ choice among providers for processing services and weakening competitive discipline in contract negotiations.
The transaction would significantly increase market concentration
By reducing the number of major integrated providers at the Fort Saskatchewan hub, the transaction would significantly increase market concentration.
The Bureau’s review concluded that this structural change would increase the merged firm’s ability to increase prices and impose less favourable contract terms, reduce incentives to expand capacity or invest in new infrastructure, and further entrench control over critical infrastructure that producers rely on.
Remaining competition would be unlikely to offset the loss
The Bureau also concluded that the remaining competitors, consisting of only one other major integrated provider and a small number of significantly smaller firms, could not offset the loss of Plains as an independent competitor. High capital costs, long development timelines, regulatory requirements, and geological constraints limit new entry at the Fort Saskatchewan hub.
As a result, producers would be unlikely to benefit from effective competitive constraints or timely alternatives in response to higher prices or reduced service quality.
Remedies sought
The Bureau is seeking an order from the Competition Tribunal to preserve competition in the processing of natural gas liquids at the Fort Saskatchewan hub.
The final decision in this matter rests with the Competition Tribunal, which is independent from the Bureau.
- The Competition Bureau, headed by the Commissioner of Competition, is responsible for the administration and enforcement of Canadian competition law. It investigates potentially anticompetitive conduct and may apply to the Competition Tribunal when it concludes that a transaction raises serious competition concerns.
- The Competition Tribunal is similar to a court. It hears applications made under the Competition Act and issues orders when appropriate.
Next steps
Under the Competition Tribunal’s rules, the parties typically have 45 days from the date of the Bureau’s filing to file a response. The Competition Bureau then has 14 days to file a reply. The Tribunal determines all timelines and other procedural matters on a case-by-case basis, making it difficult to predict how long the proceeding may take.
The final decision in this matter rests with the Competition Tribunal.
Additional information
- News release: Competition Bureau challenges Keyera’s proposed acquisition
- How the Competition Bureau reviews mergers
- About the Competition Tribunal