Canadian Pipeliner to Sell US Midstream Assets

Canada’s TC Energy (formerly TransCanada) said July 2 it has reached an agreement to sell midstream assets in the US held by subsidiary Columbia Midstream Group to UGI Energy Services for about C$1.7bn (US$1.27bn). The transaction is expected to close in 3Q 2019.

Columbia Midstream operates in the Appalachian basin, owns four natural gas gathering systems and an interest in a company with gathering, processing and liquids assets and serves markets throughout western Pennsylvania, eastern Ohio and northern West Virginia. The sale does not include any of TC Energy’s extensive network of interstate pipelines in the Appalachian basin operated by subsidiary Columbia Gas Transmission.

“The sale of Columbia Midstream advances our ongoing efforts to prudently fund our portfolio of high-quality natural gas pipeline, liquids pipelines and power generation projects, while maximising value for our shareholders,” TC Energy CEO Russ Girling said.

Together with other asset sales earlier this year, TC Energy expects to realise about C$3.4bn of proceeds from its 2019 portfolio management activities. Combined with “significant and growing” cash flow, access to capital markets and potential additional asset divestments, the company is “well-positioned” to fund its C$30bn secured capital program “in a manner consistent with achieving targeted credit metrics in 2019 and thereafter,” Girling added.