TransCanada has agreed to divest its 49.3% stake in Iroquois Gas Transmission System, along with remaining 11.8% interest in Portland Natural Gas Transmission System (PNGTS), to its master limited partnership, TC PipeLines.

The deal, which is valued at $765m, includes the $597m of cash payment and assumption of of $168m in proportionate debt at Iroquois and PNGTS.

The Iroquois pipeline transports natural gas under long-term contract and expands from the TransCanada Mainline system at the US  border near Waddington of New York to markets in the US northeast such as the New York City, Long Island and Connecticut.

At present, Iroquois is owned by affiliates of TransCanada and Dominion Resources under a joint venture. It is operated by a Connecticut-based stand-alone firm, which is jointly owned.

PNGTS is an interstate natural gas pipeline, which is offering energy services to the New England region since March 1999.

The pipeline, which connects with the Trans Quebec & Maritimes Pipeline at the Canadian border, shares facilities with the Maritimes and Northeast Pipeline from Westbrook of Maine to a connection with the Tennessee Gas Pipeline System near Boston of Massachusetts.

In January 2016, TransCanada had divested a 49.9% stake in PNGTS to the TC PipeLines.

Subject to customary closing conditions, the deal is expected to complete in the middle of this year.

Through its subsidiaries, TransCanada, currently has around 26% stake in TC PipeLines, which was created to purchase, own and involve in the management of US natural gas pipelines and related assets.

TransCanada president and CEO Russ Girling said: "This agreement demonstrates the meaningful role that our MLP can play in funding a portion of our $23 billion near-term growth portfolio.

"Successfully executing our capital program through the end of the decade positions TransCanada to deliver significant sustainable growth in earnings, cash flow and dividends."