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Dec. 11, 2012 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced it has entered into a definitive agreement to purchase 100 percent of the ownership interests in the Express-Platte Pipeline System from Borealis Infrastructure, the Ontario Teachers' Pension Plan and Kinder Morgan Energy Partners for
$1.49 billion, consisting of
$1.25 billion cash and
$240 million of acquired debt.
The 1,717-mile Express-Platte Pipeline System, which begins in
Hardisty, Alberta, and terminates in
Wood River, Illinois, is comprised of both the Express and
Platte crude oil pipelines. The Express pipeline carries crude oil to U.S. refining markets in the Rockies area, specifically
Laurel, Montana, and
Casper, Wyoming. The pipeline's capacity is 280,000 barrels a day. The
Platte pipeline, which interconnects with Express pipeline in
Casper, Wyoming, transports crude oil predominantly from the Bakken and
Western Canada to refiners in the
Platte's capacity ranges from 164,000 barrels a day in
Wyoming to 145,000 barrels a day to
Wood River, Illinois.
"The Express-Platte Pipeline System acquisition is an immediately accretive investment in a fee-based business that expands Spectra Energy's footprint into a rapidly growing area," said
Greg Ebel, president and chief executive officer, Spectra Energy Corp. "This system is strategically located to supply crude oil to U.S. refining markets. It also represents an incremental growth platform for Spectra Energy that enables further investment in related crude and refined product assets. Given Spectra Energy's leading position in the natural gas midstream sector, investing in crude oil midstream assets is a logical extension of our business model."
Spectra Energy expects the acquisition will be immediately accretive to earnings, with expected full-year 2013 EBITDA of approximately
$130 million and full-year annual EPS accretion in the
3 to 5 cents per share range.
The Express-Platte System is one of just three major pipelines moving crude oil from
Western Canada to Rockies and
Midwest refineries and markets, representing a significant opportunity for Spectra Energy to participate in the rapidly expanding North American crude oil pipeline market.
Completion of the transaction is subject to customary consents, regulatory approvals and closing conditions. The transaction is expected to close during the first half of 2013.