Northern Border Deals Close

Oneok (OKE Quote) bought out the remaining 17.5% general partner interest in Northern Border Partners (NBP Quote) and set several management changes at the pipeline operator.

Oneok, Tulsa, Okla., paid TransCanada (TCAPR Quote) $40 million for the remaining general partnership interest in Northern Border. Oneok then transferred to the partnership its entire gathering and processing, natural gas liquids, and pipelines and storage segments in a $3 billion transaction. Oneok received $1.35 billion in cash and 36.5 million limited partner units.

The partnership then sold a 20% interest in Northern Border Pipeline to TransCanada affiliate TC PipeLines (TCLP Quote) for $300 million. Northern Border Partners and TC PipeLines will each own a half-interest in the pipeline, with an affiliate of TransCanada becoming operator of the pipeline in April 2007.

"With the completion of these transactions, Oneok and the partnership are well positioned to grow," said Oneok chief David Kyle, who will also become chief of Northern Border. "Oneok will benefit from the expected growth of the partnership, both by acquisition and from internally generated projects. We firmly believe that our interests are clearly aligned with the limited partners and are very excited about the future." ...