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Inter Pipeline completes acquisition of the Cold Lake pipeline

Published by
World Pipelines,

Inter Pipeline Ltd. (Inter Pipeline) announced on 16 December the successful closing of its acquisition of the remaining 15% interest in the Cold Lake pipeline system from Canadian Natural Resources Limited (Canadian Natural) for CAN$527.5 million, subject to closing adjustments.

This immediately accretive acquisition, announced on 12 December 2016, results in Inter Pipeline owning 100% of the 1400 km Cold Lake pipeline system, which is the largest transporter of Cold Lake area bitumen production.

Canadian Natural received CAN$350 million in cash and CAN$177.5 million through the issuance of 6 417 740 Inter Pipeline common shares in consideration for its Cold Lake ownership interest. Funding for the cash component of the acquisition was provided from proceeds of a new 10 year medium term note offering that closed today.

Concurrent with closing of this acquisition, Inter Pipeline has entered into a binding long-term take or pay agreement with Canadian Natural to transport diluent and bitumen blend for its Kirby North SAGD oil sands project. The agreement will trigger the construction of a new CAN$125 million pipeline connection to the Kirby North production facility, with service targeted for the first quarter of 2020.

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