Enbridge Inc. has entered into a partnership with KKR and Apollo to establish a joint venture aimed at supporting the expansion of its Westcoast natural gas pipeline system. The collaboration involves an investment of approximately $2.7 billion by KKR and Apollo towards the Aspen Point and Sunrise expansion initiatives. As part of the agreement, $700 million will be paid in cash to Enbridge upon closing.
In exchange for their investment, KKR and Apollo will acquire a 29% stake in the overall Westcoast system once the Sunrise expansion project becomes operational. Enbridge has outlined that the investors will start receiving returns as each expansion project reaches completion. The Aspen Point expansion is scheduled to be operational this year, followed by the Sunrise expansion in late 2028.
While retaining majority ownership and operational authority over the West Coast system, Enbridge will oversee the expansion projects. Additionally, the company holds the option to buy back the investors’ stake in the joint venture during the period between the seventh and 14th year post-closing.