NEW YORK Spectra Energy Corp. has signed a deal to acquire the 1,717-mile Express-Platte Pipeline System for $1.49 billion.
Houston-based Spectra will take on full ownership of the system in the deal, which comprises $1.25 billion in cash and $240 million of acquired debt. Two crude oil pipelines make up the system: A 24-inch, 785-mile pipeline runs from Hardisty, Alberta, to Casper, Wyo., and a 20-inch, 932-mile pipeline runs from Casper to Wood River, Ill.
The system is currently owned by Borealis Infrastructure, the Ontario Teachers Pension Plan and Kinder Morgan Energy Partners LP.
Spectra president and chief executive officer Greg Ebel said the proposed acquisition would be immediately accretive to earnings and allow Spectra to grow its footprint in an expanding sector.
"This system is strategically located to supply crude oil to U.S. refining markets. It also represents an incremental growth platform for Spectra Energy that enables further investment in related crude and refined product assets," he said in a statement. "Given Spectra Energys leading position in the natural gas midstream sector, investing in crude oil midstream assets is a logical extension of our business model."
The deal, which is subject to regulatory approval, is expected to close during the first half of 2013.