Enbridge Inc. has recently entered into a partnership with KKR and Apollo to establish a collaborative venture aimed at financing the growth of its Westcoast natural gas pipeline system. The agreement entails KKR and Apollo contributing approximately $2.7 billion towards the Aspen Point and Sunrise expansion initiatives, with $700 million expected to be paid to Enbridge upon completion.
In exchange for their investment, KKR and Apollo will hold a 29% stake in the overall Westcoast system once the Sunrise expansion project becomes operational. Enbridge has disclosed that the investors will start receiving returns as each expansion project is completed, commencing with the Aspen Point expansion scheduled for this year, followed by Sunrise towards the end of 2028.
Enbridge will maintain majority ownership and operational authority over the West Coast system, overseeing the expansion endeavors. Additionally, the company retains the option to buy back the investors’ stake in the joint venture within the seventh to 14th year post-closure.
