NorthAmOil: Enbridge to become North America’s largest gas provider with $14bn deal

Canada’s Enbridge announced on September 5 that it had struck a deal to acquire three utilities – East Ohio Gas (EOG), Questar Gas and its related Wexpro companies and Public Service Co. of North Carolina (PSNC) – from Dominion Energy. The deal’s price tag is $14bn including $9.4bn in cash and the assumption of $4.6bn of debt.

The transaction will double Enbridge’s gas distribution and storage business and will make the company the largest natural gas provider in North America.

Through the transactions, Enbridge will acquire gas utility operations in Ohio, North Carolina, Utah, Idaho and Wyoming. It will have the capacity to deliver more than 9bn cubic feet (255mn cubic metres) per day of gas to 7mn customers with a combined rate base of over CAD27bn ($20bn).

The deal is seen as a bet by Enbridge on the future of natural gas in a regulated market even as energy companies and consumers alike turn more to renewables. For Dominion, meanwhile, the sale marks part of a strategic “top-to-bottom” business review the company launched in November 2022 that involved weighing alternatives to its existing business mix and capital allocation. As part of the review, Dominion also agreed in July to sell its 50% stake in the Cove Point LNG terminal in Maryland to Berkshire Hathaway Energy for $3.3bn. That transaction closed on September 1.

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