TransCanada’s $13 billion Pipeline Company Purchase Affects Four Oklahoma Companies.

TransCanada, the company that constructed the Keystone pipeline from Cushing south to the Gulf Coast but failed to win approval of the northern leg from Canada to Nebraska, is paying $13 billion to buy the U.S. gas pipeline company, Columbia Pipeline.

The dead includes TransCanada assuming $2.8 billion in debt, according to an announcement by the two companies. The purchase will put TransCanada in control of 57,000 miles of natural gas pipeline across the U.S., much of it in the Marcellus and Utica shale regions where much of the nation’s shale oil and gas boom was fueled by fracking techniques. The pipeline will stretch from New York to the Gulf Coast.

TransCanada lined up $10.3 billion in bridge-loan financing and will pay $25.50 per share for Columbia shares. That represents a 32 percent premium over the stock’s 30-day average.

“We are confident that the acquisition will lead to both near-term and long-term growth opportunities as production in the Appalachian region continues to grow,” said Russ Girling, TransCanada CEO. He said the deal will also give TransCanada a strong position in the two lucrative gas regions.

The purchase agreement is expected to be finalized in the second half of 2016.

Columbia Pipeline Group had earlier announced a proposed 161-mile pipeline costing $1.4 billion to carry natural gas from the Utica and Marcellus shales in Ohio, West Virginia and western Pennsylvania to markets in Mid-Atlantic and Gulf Coast states. The company is still awaiting final approval from the Federal Energy Regulatory Commission but hopes to begin construction late this year with service starting in 2017.

Four drilling companies support the pipeline including Oklahoma-based American Energy Partners LP, the company founded a few years ago by the late Aubrey McClendon. Range Resources of Oklahoma City, formerly Lomac Drilling is another. Noble Energy of Ardmore is a third company while the fourth is Kaiser Marketing Appalachia LLC, based in Tulsa. All four have signed agreements to ship their natural gas in the new line.


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