Enbridge, Marathon take minority stake in Bakken pipeline
VANCOUVER (Reuters) - Enbridge Inc (ENB.TO: Quote) said on Tuesday it had formed a joint venture with Marathon Petroleum Corp (MPC.N: Quote) to take a minority stake in a holding company that owns 75 percent of the Bakken Pipeline System.
Enbridge, through its subsidiary Enbridge Energy Partners, will pay $1.5 billion for what will amount to a 27.6 percent stake in the pipeline system, which is set to carry oil from the Bakken region to Midwestern refineries and on to the Gulf Coast. Marathon will pay $500 million for its smaller share.
"This will provide our shippers the ultimate potential to reach the eastern USGC (United States Gulf Coast), which has been a strategic priority for us," Guy Jarvis, Enbridge's executive vice president for liquids pipelines, said in a statement.
The Bakken Pipeline System is made up of two pipeline projects - the Dakota Access Pipeline and the Energy Transfer Crude Oil Pipeline - both of which are expected to be in service by year end.
The deal involves the Enbridge-Marathon joint venture paying $2 billion to Energy Transfer Partners (ETP.N: Quote) and Sunoco Logistics Partners SXL.N for a 49 percent stake in the holding company that owns 75 percent of the system.
Phillips 66 (PSX.N: Quote) owns the remaining 25 percent of the Bakken Pipeline System. Once in operation, Sunoco Logistics will be the pipeline operator.
The all-cash deal is expected to close in the third quarter of 2016.
(Reporting by Julie Gordon; Editing by Andrew Hay)
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