(Reuters) – Canada’s Encana Corp will sell some natural gas gathering and compression facilities in British Columbia it owns jointly with a unit of Mitsubishi Corp to Veresen Midstream LP.
Encana said it would receive about $412 million from the sale and actual costs accrued in 2015.
The facilities include a 500-kilometer pipeline and compression facilities of 675 million cubic feet per day.
Veresen Midstream will provide gathering and compression services to Encana and Cutbank Ridge Partnership, its partnership with a Mitsubishi unit, for a fee.
Veresen Midstream, a joint venture of Veresen Inc and U.S. private equity firm Kohlberg Kravis Roberts & Co LP (KKR), will also invest up to $5 billion to support development in the Montney shale.
Encana and Cutbank Ridge Partnership plan to invest US$600 million-US$700 million in the Montney shale in 2015, the Canadian company said.
The transaction is expected to close in the first quarter of 2015.
Based in Calgary, Veresen owns and operates energy infrastructure assets across North America.
This year Encana also sold assets to Ember Resources Inc, a coal-bed methane producer backed by Brookfield Asset Management‘s private equity group.
(Reporting by Narottam Medhora in Bengaluru; Editing by Kirti Pandey)
(This story has been edited by Kirk Falconer, editor of peHUB Canada)
Photo courtesy of Shutterstock
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