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Enbridge, KKR, Apollo Form $1.9 billion Westcoast Pipeline Joint Venture

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Enbridge (ENB) said on Thursday it had agreed to form a joint venture with KKR and Apollo Global Management (APO), securing CA$2.7 billion ($1.94 billion) to fund natural gas pipeline expansions in British Columbia.

KKR and Apollo will invest about CA$2.7 billion in the projects, including CA$700 million in cash to Enbridge at closing, in exchange for an indirect, cumulative 29% stake in the Westcoast system once the Sunrise expansion enters service.

The Canadian energy infrastructure firm said the deal will help it recycle capital while retaining majority ownership and operational control of the pipeline system.

"This transaction allows us to efficiently recycle capital, strengthen our balance sheet, and maintain financial flexibility while advancing a strong pipeline of high-returning growth opportunities," said Pat Murray, chief financial officer at Enbridge.

The partnership will finance Enbridge's Aspen Point and Sunrise expansion programs, which have regulatory approval and are backed by long-term take-or-pay contracts.

Aspen Point is projected to enter service this year, while Sunrise is targeted for late 2028.

The investors will begin receiving distributions as each expansion enters service.

Enbridge said it would remain responsible for executing the projects and will have an option to repurchase the investors' interest in the joint venture between the 7th and 14th years after the transaction closes.

The company said the transaction is not expected to have a material impact on Enbridge's 2026 financial guidance or medium-term financial outlook.

Enbridge said its capital recycling program has generated CA$19 billion in proceeds since 2014.

The Westcoast system transports natural gas across Western Canada and serves markets in British Columbia, the US Pacific Northwest and international LNG markets.

Price: $49.82, Change: $-0.55, Percent Change: -1.09%

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