Tidewater Midstream and Infrastructure Ltd. has announced that it has entered into definitive agreements with Pembina Pipeline Corporation and certain of its affiliates, through a wholly owned limited partnership, to acquire the North Segment of Pembina's Western Pipeline System for total cash consideration of approximately CAN$1.2 million, as well as the assumption of certain future abandonment and reclamation obligations and liabilities estimated to be approximately CAN$30.0 million.
The Western Pipeline is an approximately 377 km crude oil pipeline originating in Taylor, British Columbia and terminating in Prince George, British Columbia. The Western Pipeline's connection at Taylor, British Columbia is the key conduit tying the Prince George Refinery (PGR) into the northeastern British Columbia crude supply region. As part of the Transaction, Tidewater and Pembina will enter into an interconnection agreement upon closing which will allow Tidewater to continue to access existing crude sources at the terminal located in Taylor, British Columbia for the next 25 years, which is expected to provide PGR with a reliable and cost-effective source of feedstock. The Transaction is anticipated to yield material run-rate cost improvements, compared to historical metrics, while further enhancing Tidewater's ability to optimise its feedstock procurement at the PGR.
"We are excited to announce the agreement to purchase the Western Pipeline. The Transaction provides Tidewater with the opportunity to unlock meaningful cost savings and increased flexibility and control of our day-to-day refining operations at the PGR. We expect that the Transaction will allow us to significantly reduce the cost of feedstock flowing into PGR, which will improve product margins and will play a key role as we continue to focus on optimising our refining assets.", said Jeremy Baines, Chief Executive Officer of Tidewater.
The Transaction is expected to close on or before 1 September 2025 and is subject to customary post-closing adjustments and regulatory approvals.
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