TC PipeLines LP (TCPL) will acquire the remaining 30% interest in Gas Transmission Northwest LLC (GTN) from TransCanada Corp., which, through its subsidiaries, currently holds 28% interest in TCPL.
GTN is a 2,178-km pipeline that transports natural gas under long-term contracts from the Western Canada Sedimentary Basin and the Rocky Mountains to Washington, Oregon, and California. TransCanada’s board has approved the sale, which is expected to close by the end of first-quarter 2015.
TransCanada purchased GTN in first-quarter 2004 for $1 billion (OGJ Online, Feb. 25, 2004). In 2013, TCPL agreed to acquire an additional 45% interest in each of GTN and Bison Pipeline LLC from TransCanada for $1.05 billion (OGJ Online, May 16, 2013).
The sale will contribute to funding the company’s $46 billion in commercially secured projects, including $2.7 billion of NGTL system expansions and $475 million in pipeline and facility investments within the Eastern Triangle portion of the Canadian mainline.
“This transaction, along with the recent sale of our remaining 30% interest in the Bison Pipeline [LLC], further demonstrates our commitment to drop down all of our remaining US natural gas pipeline assets to the partnership on a more sizable and frequent basis,” said Russ Girling, TransCanada’s president and chief executive officer.
TCPL in October agreed to acquire the remaining 30% interest in Bison Pipeline from TransCanada for $215 million (OGJ Online, Oct. 1, 2014).
TransCanada also expects to drop down to TCPL its remaining 44.5% and 61.7% interest in Iroquois and Portland, respectively; and 100% and 53.6% interest in ANR and Great Lakes, respectively. The company believes TCPL has the capacity to complete drop downs of more than $1 billion/year going forward.
