Veresen buys 50% of Ruby gas pipeline in Western US for $1.4 billion
By JEREMY vAN LOON and REBECCA PENTY
Bloomberg
Veresen, the Canadian company planning a terminal to ship liquefied natural gas to Asia from Oregon, agreed to buy Global Infrastructure Partners’ 50% stake in the Ruby pipeline for $1.43 billion.
The 680-mile (1,094-kilometer) pipeline supplies gas from Wyoming to the Malin hub in Oregon, Calgary-based Veresen said in a statement.
The Malin hub connects to a pipeline that would feed Veresen’s proposed Jordan Cove LNG terminal on the state’s coast.
CEO Don Althoff has been seeking purchases as Veresen shares gained 38% in a year and its LNG export project gains traction. The Ruby stake is its largest acquisition so far.
Veresen’s proposed LNG facility is scheduled to start up in 2019 and initially produce 6 million tpy of LNG, or 1 billion cubic feet of gas. The project won approval from the US Energy Department in March to export the fuel.
The company has estimated the Jordan Cove project may cost C$5.3 billion ($4.8 billion). Energy companies are vying to build coastal LNG plants to tap Asian gas prices that are about five times higher than in North America.
Kinder Morgan owns the other half of the Ruby pipeline and will continue to operate it. The transaction is expected to close by the end of the year, Veresen said.
Canadian Imperial Bank of Commerce and Bank of Nova Scotia advised Veresen on the purchase.
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