Houston pipeline operator Kinder Morgan has exited the Canadian market after closing a deal worth estimated to be more than $2.5 billion in cash and stock.
Source: Houston Chronicle
In a Monday afternoon statement, Kinder Morgan reported closing a deal to sell its subsidiary Kinder Morgan Canada and cross-border Cochin Pipeline to the Calgary pipeline and storage terminal operator Pembina Corp.
Pembina paid Kinder Morgan more than $1.5 billion in cash for the Alberta-to-Michigan tar sands crude oil pipeline and stock currently valued at $935 million to buy Kinder Morgan Canada. The deal will be added to Kinder Morgan’s fourth quarter results.
The sale ended months of speculation about the future of Kinder Morgan Canada, a publicly traded company on the Toronto Stock Exchange. That future became clouded after an economic development arm of the Canadian government bought Kinder Morgan Canada’s Trans Mountain Pipeline system and a related expansion project in a $4.5 billion cash deal that closed in August 2018.
Designed to move crude oil from the tar sands region of Alberta across the Canadian Rockies to the Pacific Coast, the Trans Mountain Pipeline system received approval from the Canadian government in November 2016 to undergo a major expansion, but faced stiff opposition from various municipalities in British Columbia, Native American groups and environmentalists. Kinder Morgan suspended work on the expansion project and then sold it to the Canadian government, which viewed it as vital to expanding Canadian oil exports.
Founded in 1997 and headquartered in Houston, Kinder Morgan has nearly 11,000 employees across the United States and Mexico.
The company reported a $1.48 billion profit on $14 billion of revenue in 2018.
