Enbridge Inc. has entered into a partnership with KKR and Apollo to establish a joint venture aimed at financing the growth of its Westcoast natural gas pipeline system. The collaboration entails an investment of approximately $2.7 billion by KKR and Apollo to support the Aspen Point and Sunrise expansion initiatives. As part of the deal, Enbridge will receive $700 million in cash upon closing.
In exchange for their investment, KKR and Apollo will obtain a 29% stake in the combined Westcoast system once the Sunrise expansion becomes operational. Enbridge has disclosed that the investors will start receiving returns as each expansion project is completed, with the Aspen Point expansion scheduled for completion this year, followed by Sunrise in late 2028.
Enbridge will maintain majority ownership and operational authority over the West Coast system, overseeing the expansion projects. The company will also have the opportunity to buy back the investors’ stake in the joint venture between the seventh and 14th year after the transaction is finalized.