Enbridge Inc. has recently entered into a partnership with KKR and Apollo to establish a joint venture aimed at financing the expansion of its Westcoast natural gas pipeline network. The collaboration involves an investment of approximately $2.7 billion from KKR and Apollo to support the Aspen Point and Sunrise expansion initiatives. As part of the deal, $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 disclosed that the investors will start receiving returns as each expansion phase is completed, with the Aspen Point expansion anticipated to commence operations this year, followed by Sunrise in late 2028.
Enbridge will maintain majority ownership and operational authority over the West Coast system, including overseeing the expansion undertakings. Additionally, the company holds the option to buy back the investors’ stake in the joint venture within the seventh to 14th year post-closure.