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Enbridge Loses Early Gains As Moves To Buy Stake in Cabin Gas Plant From Encana, Which Is Down Nearly 3%

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Enbridge Inc. (ENB.TO) announced today that it has reached agreement with Encana Corporation (ECA.TO), on behalf of certain co-owners of the Cabin Gas Plant Development, whereby Enbridge will become the majority owner in the Cabin Gas Plant Development located 60 kilometers northeast of Fort Nelson, British Columbia in the Horn River Basin. Enbridge was little changed after 15 minutes of trading having touched a day high $33.36 in the early minutes and looking like it might tackle an existing year high $33.71. Encana was down near 3%.

Under the terms of the Asset Purchase and Sale agreement, Enbridge will acquire a 57.6% interest in Phases 1 and 2 of the Cabin Gas Plant Development which together will be capable of processing 800 million cubic feet per day (Mmcf/d) of natural gas. Upon completion of Phases 1 and 2, Enbridge's total investment is expected to be approximately $900 million.

Phase 1 of the development will have 400 Mmcf/d of natural gas processing capacity. The plant is currently under construction and is expected to be in-service in the third quarter 2012. Phase 2 will add an additional 400 Mmcf/d of capacity and has been sanctioned by producers and received regulatory approval. The Phase 2 plant is expected to be ready for service in the third quarter 2014. Capacity for both Phases 1 and 2 has been fully taken up by Horn River producers.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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