Enbridge Energy Partners LP has entered into a purchase and sale agreement to sell an additional 12.6% interest in midstream natural gas subsidiary Midcoast Operating LP to Midcoast Energy Partners LP for $350 million.
The transaction is expected to close on or about July 1. Enbridge will retain 48.4% non-controlling limited partner interest in Midcoast Operating, while Midcoast Energy will hold 51.6% controlling interest.
"The proceeds from this and prospective drop-downs are important sources of equity capital for Enbridge Partners as we execute on our multibillion dollar liquids pipelines organic growth program,” said Mark Maki, Enbridge president.
Enbridge's natural gas gathering, treating, processing, and transmission assets, principally located onshore in the US Mid-Continent and Gulf Coast areas, deliver 2.5 billion cu ft/d of natural gas.
"This immediately accretive drop-down from EEP is a tangible first step as we execute our strategy of increasing the scale of Midcoast Partners and positioning the partnership to become a leading natural gas and NGL midstream infrastructure developer in North America," said C. Gregory Harper, Midcoast Energy principal executive officer.
Midcoast Energy, a limited partnership formed by Enbridge, serves as Enbridge’s primary unit for owning and growing its natural gas and natural gas liquids midstream business in the US.
Midcoast Operating is a Texas limited partnership that owns a network of natural gas and NGL gathering and transportation systems, natural gas processing, and treating facilities and NGL fractionation facilities primarily in Texas and Oklahoma. Midcoast Operating also owns and operates natural gas, condensate, and NGL logistics and marketing assets that primarily support its gathering, processing, and transportation business.