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Energy Transfer assets part of KKR-Pembina combination of Canadian natural gas players


KKR & Co. and Pembina Pipeline Corp. agreed to combine their natural gas processing assets in Western Canada to create a new joint venture.

The entity will also acquire certain interests held by Dallas-based Energy Transfer LP. The total value of the transactions totals $9 billion, the companies said Tuesday in a statement. That sum excludes the value of any assets under construction.

Energy Transfer said it’s selling its 51% stake in Energy Transfer Canada to a joint venture in a deal valued at $1.3 billion, including debt and preferred equity. Energy Transfer expects to net $270 million when the deal closes later this year.

The combined company, dubbed “Newco” for now, will have a foothold in northeast British Columbia, a basin with significant gas reserves. Although there’s no operational export terminal for liquefied natural gas in the province, several projects have been proposed to supply a growing global market for the fuel.

The public-private tie-up brings efficiencies and cost reductions, the companies said.

“We share Pembina’s views on the positive and essential role that Canadian natural gas plays within the global energy transition and we are pleased to combine these assets to create a stronger platform to meet that opportunity,” said Brandon Freiman, head of North American infrastructure at KKR.

Pembina appointed Scott Burrows as chief executive officer last week.

Energy Transfer Canada, based in Calgary, is one of Alberta’s largest licensed natural gas processors, with six plants and 848 miles of pipelines.



Read More: Energy Transfer assets part of KKR-Pembina combination of Canadian natural gas players

2022-03-01 09:30:12

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