Enbridge Inc. has entered into a partnership with KKR and Apollo to establish a joint venture aimed at supporting the growth of its Westcoast natural gas pipeline system. The collaboration involves a total investment of approximately $2.7 billion by KKR and Apollo to facilitate the Aspen Point and Sunrise expansion initiatives, with $700 million to be paid upfront to Enbridge.
In exchange for their investment, KKR and Apollo will hold a 29% stake in the combined Westcoast system upon the completion of the Sunrise expansion project. Enbridge has outlined that the investors will start receiving returns as each expansion endeavor becomes operational, with the Aspen Point expansion projected to commence operations this year, followed by Sunrise in late 2028.
Enbridge will maintain majority ownership and operational authority over the West Coast system, overseeing the expansion projects as well. Additionally, the company will have the opportunity to buy back the investors’ stake in the joint venture between the seventh and 14th year post-closing.