By OGJ editors
HOUSTON, Oct. 27 -- TransCanada Corp., Calgary, has agreed to acquire Houston-based El Paso Corp.'s 29.64% interest in Portland Natural Gas Transmission System (PNGTS) for $137.2 million, including assumed debt of $80.7 million.
Closing is expected to be completed by Dec. 31. Under terms of the PNGTS partnership agreement, Gaz Métropolitain and Co. Ltd. has the right to acquire its pro rata share of El Paso's offered interest. This right is exercisable for 30 days after receipt of formal notice from El Paso.
If this right of first offer is not exercised, TransCanada' s interest in Portland will increase to 73.06% from 43.42%. If Gaz Métropolitain's right of first offer is exercised, TransCanada's total interest will increase to 61.71%. In that case, the purchase price paid by TransCanada would be reduced proportionately.
"Increasing our interest in PNGTS bolsters TransCanada's role as an energy supplier in the US Northeast," said Hal Kvisle, TransCanada's CEO. "PNGTS is a strategic link in the US Northeast, providing this market access to current and future supplies of natural gas."
PNGTS owns a 290-mile, 220 MMcfd interstate natural gas pipeline that connects with the Trans Québec & Maritimes Pipeline near Pittsburg, NH, and serves delivery points in Maine, New Hampshire, and Massachusetts.
In September, TransCanada increased its PNGTS stake by 10.13% with the acquisition of part of DTE East Coast Pipeline Co.'s interest in PNGTS for $47.1 million, including assumed debt of $27.8 million.