The Competition Bureau logo is shown in Gatineau, Que., on Thursday, Jan. 29, 2026. THE CANADIAN PRESS/Justin Tang
By Lauren Krugel
The Competition Bureau’s challenge to Keyera Corp.’s purchase of Plains All American Pipeline LP’s natural gas liquids business is rife with incorrect assumptions about the industry and should be dismissed with costs, the companies argued in responses filed this week.
The federal competition watchdog announced in May that it had applied to the independent, court-like Competition Tribunal to challenge the $5.15-billion deal, which closed shortly thereafter. The bureau argues the purchase is likely to harm energy producers and stifle investment, and that the tribunal should either order the acquisition be dissolved or that Keyera divest some assets.
In its rebuttal, Keyera said the purchase is a “pro-competitive” development in the natural gas liquids industry.
“The transaction is not the acquisition of a vigorous, effective ‘rival,'” Keyera argued. “Rather, it brings together two synergistic businesses to create a more capable, efficient competitor. The commissioner’s theory that the transaction will substantially lessen or prevent competition does not withstand scrutiny.”
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At the heart of the Competition Bureau’s case is the position both companies had at Canada’s main natural gas liquids processing hub in Fort Saskatchewan, Alta., northeast of Edmonton. At such facilities, often referred to as fractionators, valuable liquids like butane and propane are separated out of raw natural gas, creating high-value fuels and feedstocks used in agriculture and petrochemicals.
Keyera argued the competition commissioner focused on an “artificially narrow geographic market” and didn’t take into account the many other fractionators that exist across Western Canada that compete directly with the ones in Fort Saskatchewan.
“The commissioner’s narrow focus on Fort Saskatchewan also ignores the fundamental geographic reorientation underway in the industry, as export demand for production shifts westward to Asian markets,” Keyera said.
“Fractionators outside of Fort Saskatchewan are well placed to meet this ongoing and accelerating trend owing to their closer proximity to West Coast export facilities.”
Keyera also takes issue with the bureau’s focus on the maximum amount of natural gas fractionators are capable of handling, versus the portion that is actually up for grabs in the market. Much of a plant’s so-called “nameplate” capacity is actually covered under long-term contracts with customers or set aside for companies’ own internal use, it said.
With the plants’ capacity locked up several years out into the future, the competition commissioner’s case “rests on conjecture” about what could happen in the long-term, Keyera argued.
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“But there is no crystal ball. Past predictions about the trajectory of the oil and gas industry have been routinely mistaken, and there is no reason to believe the commissioner’s forecasts will fare any better.”
In its arguments, Plains also denies that the deal harms competition, leaning on Keyera’s submissions to back up its case. Plains argued that even if the sale did harm competition, dissolving it would be “overbroad, intrusive, ineffective, and otherwise unnecessary and inappropriate.”
This report by The Canadian Press was first published July 16, 2026.
Companies in this story: (TSX:KEY)
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