CALGARY: Enbridge Inc, the Canadian energy infrastructure giant, has reached an agreement to buy Tallgrass Energy’s crude oil business from Blackstone Inc for about US$2.6bil.
The deal includes 75% of the Pony Express Pipeline, 51% of the Powder River Gateway system and 8.4 million barrels of storage capacity, according to a statement Wednesday.
Bloomberg reported earlier that Enbridge was in advanced talks to buy the pipeline.
Enbridge shares fell as much as 2.6% after the deal was announced.
The deal, expected to close later in 2026, is a test if the tariff war between the United Sates and Canada will bleed into one of the sleepier corners of the Merger and Acquisition (M&A) market: energy pipelines.
The Pony Express carries crude oil about 900 miles (1,488km) from oil fields in the Rocky Mountain region to Cushing, Oklahoma, one of the busiest pipeline hubs in the world.
It is the second largest Canada-to-United States M&A deal this year, and the biggest since trade talks collapsed between the two countries in August, according to date compiled by Bloomberg.
President Donald Trump has taken a keen interest in oil pipelines in the past.
He signed a presidential permit in April authorising the expansion of the Bridger pipeline to carry Canadian oil to Wyoming.
That project is a partial revival of the Keystone XL Pipeline, which the president sought to revive during his first term.
While Enbridge is based in Calgary, it has a massive presence in the United States, with a pipeline network that carries oil from Western Canada and US natural gas supplies to utilities, refineries and liquefied natural gas export terminals across the continent.
At the time of its US$28bil purchase of Spectra Energy in 2017, Enbridge became the largest energy pipeline and storage company in North America. — Bloomberg
