Enbridge to buy Murphy Oil's gas plants and pipelines in British Columbia for C$538 mn
28 January 2016
Enbridge Inc, Canada's largest pipeline company, yesterday struck a deal to buy Murphy Oil Corp's Tupper Main and Tupper West gas plants and associated pipelines in northeastern British Columbia for C$538 million ($382 million).
Enbridge, based in Calgary, said that the deal will initially be funded from available sources of liquidity.
Located 35kms southwest of Dawson Creek, northeastern British Columbia, the Tupper Main and Tupper West plants are adjacent to Enbridge's existing Sexsmith gathering system and close to the Alliance pipeline, which is 50 per cent owned by Enbridge Income Fund.
Tupper Main was placed into service in late 2008 and has a licensed capacity of 110 MMcf/d. Tupper West went into service in early 2011 and has a licensed capacity of 210 MMcf/d. The assets include approximately 53kms of high pressure pipelines.
"This acquisition fits extremely well with Enbridge's low risk value proposition and supports our key priority of extending and diversifying growth," said Gregory Harper, president of Gas Pipelines and Processing.
"These assets, which are currently in operation, are underpinned by long-term contracts that generate highly predictable cash flows. They also enhance our natural gas footprint within the Montney, one of the most attractive gas plays in North America, and add gas processing services in proximity to our existing Sexsmith gathering system," he added.
In a separate deal, Murphy Oil said that it would buy working interests in some of Athabasca Oil Corp's assets in Alberta for C$475 million.
Murphy Oil will buy a 70 per cent working interest in Kaybob Duvernay lands and 30 per cent non-operated working interest in Montney lands.