Pacific Northern Gas Ltd. (TSX:PNG) announced this morning that it’s selling a 50% interest in the Pacific Trail Pipelines Limited Partnership to Apache Canada Ltd. and EOG Resources Canada Inc. for $50 million.
“We think that it provides full value for the work that we have done to date in developing the Pacific Trail Pipelines project to this point in time,” PNG’s vice-president of operations and engineering Greg Weeres said. “We believe it not only provides value to our shareholders, but also to our customers and in fact, because we believe this transaction helps the entire project move forward, we think it helps all the communities along the route as well.”
The buyers are PNG’s Calgary-based partners in the 463-kilometre Kitimat-Summit Lake Natural Gas Pipeline Looping Project, who approached PNG about the purchase. The pipleline would serve a planned Kitimat natural gas export facility that is owned by Apache Canada Ltd. and EOG Resources Canada Inc.
“Our partners approached us because they felt it was necessary to more closely co-ordinate the development of both the terminal and the pipeline to increase the likelihood of both projects moving forward,” Weeres said.
Pacific Northern Gas stock was up 3.3% to $33.99 at press time.
This announcement comes as Canada is pressuring the United States for approval of the Keystone XL pipeline, and media reports that Kinder Morgan Canada Inc. is looking to expand its Trans Mountain pipeline.