Enbridge to Sell U.S. Gas Pipelines Unit
May 9 (Reuters/P&GJ) - Enbridge will sell a U.S. gas pipelines business for $1.12 billion, the Canadian pipeline operator said on Wednesday, achieving the first step in its plan to reduce approximately $61 billion in long-term debt.
The Calgary-based firm will sell Midcoast Operating, its U.S. gas pipelines unit, to an affiliate of private equity firm ArcLight Capital Partners. Midcoast operates natural gas gathering and processing facilities in the East Texas, Western Anadarko, and Barnett shale plays. It also owns a 35 percent interest in Enbridge's Texas Express NGL pipeline system.
"The sale of Midcoast is an important step in our shift towards a pure regulated pipeline and utility model," Enbridge Chief Executive Officer Al Monaco said. "This transaction, in addition to our other funding actions taken, accelerates funding for our secured capital program and gives us increased financial flexibility."
Investors have pressured Enbridge to sell assets that are not integral to its main oil and natural gas pipelines business since its $28 billion purchase last year of U.S.-based Spectra Energy. To address the concerns, Enbridge said in November it would raise more than $2.33 billion from divestments in 2018.
The transaction is expected to close in the third quarter of 2018.
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