Enbridge Inc. has formed a C$2.7 billion joint venture with KKR and Apollo to fund expansions of its Westcoast natural gas pipeline system, the company said on Thursday.
Under the agreement, KKR and Apollo will invest approximately C$2.7 billion to support the Aspen Point and Sunrise Expansion Programs. At closing, Enbridge will receive a C$0.7 billion cash payment. The deal grants the private equity firms an indirect, cumulative 29% ownership interest in the Westcoast system once the Sunrise project enters service, expected in late 2028. Enbridge will retain majority ownership and operational control of the system.
The Westcoast pipeline, stretching over 2,900 kilometers from Fort Nelson in northeast British Columbia to the Canada-U.S. border at Huntingdon/Sumas, currently transports up to 3.6 billion cubic feet of natural gas per day. The Sunrise Expansion Program is projected to increase capacity to 3.9 billion cubic feet per day upon completion. Both expansions have regulatory approval and are backed by long-term take-or-pay contracts.
The Aspen Point Expansion Program is expected to enter service in 2026, while the Sunrise project is slated for late 2028. Enbridge retains the option to repurchase the investors' 29% interest between the seventh and fourteenth year following the transaction's closing.
Pat Murray, Enbridge's Executive Vice President and Chief Financial Officer, said the transaction enables the company to recycle capital efficiently, strengthen its balance sheet, and maintain financial flexibility while advancing high-return growth opportunities.
Morgan Stanley Canada Limited served as lead advisor, with TD Securities acting as co-advisor on the deal. Enbridge noted that the transaction is subject to customary closing conditions and is not material to its 2026 financial guidance or medium-term outlook.
