Spectra Energy (SE) to Acquire Express-Platte Pipeline in $1.49B Deal

December 11, 2012 6:16 AM EST Send to a Friend
Spectra Energy Corp (NYSE: SE) today announced it has entered into a definitive agreement to purchase 100 percent of the ownership interests in the Express-Platte Pipeline System from Borealis Infrastructure, the Ontario Teachers' Pension Plan and Kinder Morgan Energy Partners (NYSE: KMP) for $1.49 billion, consisting of $1.25 billion cash and $240 million of acquired debt.

The 1,717-mile Express-Platte Pipeline System, which begins in Hardisty, Alberta, and terminates in Wood River, Illinois, is comprised of both the Express and Platte crude oil pipelines. The Express pipeline carries crude oil to U.S. refining markets in the Rockies area, specifically Billings and Laurel, Montana, and Casper, Wyoming. The pipeline's capacity is 280,000 barrels a day. The Platte pipeline, which interconnects with Express pipeline in Casper, Wyoming, transports crude oil predominantly from the Bakken and Western Canada to refiners in the Midwest. Platte's capacity ranges from 164,000 barrels a day in Wyoming to 145,000 barrels a day to Wood River, Illinois.

Spectra Energy expects the acquisition will be immediately accretive to earnings, with expected full-year 2013 EBITDA of approximately $130 million and full-year annual EPS accretion in the 3 to 5 cents per share range.

The Express-Platte System is one of just three major pipelines moving crude oil from Western Canada to Rockies and Midwest refineries and markets, representing a significant opportunity for Spectra Energy to participate in the rapidly expanding North American crude oil pipeline market.

Completion of the transaction is subject to customary consents, regulatory approvals and closing conditions. The transaction is expected to close during the first half of 2013.


Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Corporate News, Hot Corp. News, Mergers and Acquisitions

Related Entities

Bakken Formation, Crude Oil, Earnings, Ontario Teachers Pension Plan

Add Your Comment