Tundra to acquire pipeline system
Enbridge Inc. is selling a pipeline network in Saskatchewan and Manitoba to Tundra Energy Marketing Ltd. for $1.08 billion as Canada’s largest oil pipeline operator sells off non-core assets following its purchase of Spectra Energy Corp. The sale is expected to close at the end of the fourth quarter, Enbridge Income Fund Holdings Inc. said Thursday. The cash transaction is subject to regulatory conditions and does not include the Bakken Expansion Pipeline. Enbridge is selling the pipeline network, which includes conduits for liquids and related facilities in southeast Saskatchewan and southwest Manitoba, following the $28-billion takeover of Spectra Energy, that will make the combined company the largest pipeline operator in North America. The sale of the South East Saskatchewan Pipeline System also helps the company’s income fund finance its growth program, chief financial officer John Whelen said in a statement. “The monetization of these non-core assets at an attractive valuation provides a low-cost funding source for the Enbridge group,” Whelen said. The system transports about 175,000 barrels of crude oil per day to Enbridge’s Mainline system at Cromer, Man. All employees of Enbridge working on the Southeast Saskatchewan System are expected to join Tundra following the closing of the transaction. Tundra Energy Marketing Limited is a wholly-owned subsidiary of James Richardson & Sons, Limited, a Winnipeg-based private company, also active in the international grain trade, food processing, energy exploration and production, insurance, real estate and financial services industries.