Canadian pipeline company Enbridge and US-based Plains All American Pipeline have acquired their remaining stake in Cactus II Pipeline for $265m.
Enbridge has purchased a 10% stake and Plains a 5% stake in Cactus II from Western Midstream Partners, paying a proportionate share of the purchase price.
Western Midstream Partners (WES) is a Delaware master limited partnership that aims to acquire, own, develop, and operate midstream assets.
With the acquisition, Plains and Enbridge become the sole owners of Cactus II, with 70% and 30% respective ownership interests, respectively, and Plains will continue as the operator.
Western Midstream Partners chief executive officer Michael Ure said: “We are pleased to announce the divestiture of our interest in Cactus II to our former operating partners, Plains and Enbridge.
“This transaction demonstrates our disciplined approach in evaluating our portfolio, focusing on our core gathering and processing businesses in the Delaware and DJ Basins, and returning value to our unitholders.”
Cactus II is a 26-inch diameter, 670,000 barrel-per-day oil pipeline that runs from the Delaware basin in West Texas to Corpus Christi, with further connectivity to Ingleside.
In October last year, Enbridge acquired Ingleside Energy Centre near Corpus Christi, Texas, said to be the largest crude oil export facility in the US, in terms of volume.
Together with Enbridge’s Ingleside Energy Centre, Cactus II is said to deliver responsibly produced energy supplies to the US Gulf Coast (USGC) and global markets.
PAA is a midstream energy company that owns and operates transportation and storage infrastructure and provides logistics services for crude oil and natural gas liquids (NGL).
Plains chairman and chief executive officer Willie Chiang said: “We’re pleased to reach this agreement with Western Midstream and further strengthen our relationship with Enbridge.
“This is another example of our continued focus on optimizing our portfolio and creating mutually beneficial transactions for all involved. We appreciate Western’s partnership over the years and look forward to continuing to work with Enbridge.”
