Enbridge Inc. has forged a partnership with KKR and Apollo to establish a joint venture aimed at financing the enhancement of its Westcoast natural gas pipeline system. The collaboration involves KKR and Apollo committing approximately $2.7 billion to support the Aspen Point and Sunrise expansion initiatives, with $700 million to be paid to Enbridge in cash upon closing.
In exchange for their investment, KKR and Apollo will secure a 29% stake in the overall Westcoast system following the commencement of the Sunrise expansion. Enbridge has disclosed that the investors will start receiving distributions as each expansion project becomes operational, with the Aspen Point expansion expected to start operating this year, while Sunrise is projected to come online by late 2028.
Enbridge will maintain majority ownership and operational authority over the West Coast system, including oversight of the expansion endeavors. Additionally, the company will have the opportunity to repurchase the investors’ stake in the joint venture within the seventh to 14th year post-closure.