TransCanada has unveiled plans to sell 49.3% stake in Iroquois gas transmission system and the remaining 11.8% interest in Portland natural gas transmission system (PNGTS) to its master limited partnership TC PipeLines.
The board of directors from TransCanada have approved to sell interest in Iroquois and PNGTS projects. However, the transaction is subject to satisfactory negotiation of terms, compliance with any applicable regulatory requirements, and Partnership Board approval.
The Iroquois pipeline distributes natural gas under long-term contracts. It extends from the TransCanada Mainline system at the US border near Waddington of New York to markets in the US Northeast, including New York City, Long Island and Connecticut.
Currently, a joint venture formed by the affiliates of TransCanada and Dominion Resources own Iroquois pipeline. It is operated by a stand-alone company that is also jointly owned and based in Connecticut.
PNGTS is a high-capacity interstate natural gas pipeline, which fulfills the energy needs of New England.
It connects with the TransQuebec and Maritimes Pipeline at the Canadian border and 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, TransCanadahas divested a 49.9% stake in PNGTS to the partnership.
Through its subsidiaries, TransCanada currently owns around 27% interest in TC PipeLines, which was created to acquire, own and manage US natural gas pipelines and related assets.
TransCanada president and CEO Russ Girling said: "This offer demonstrates the meaningful role that TC PipeLines, LP can fulfill in funding a portion of our $23 billion near-term capital program.
"Delivering on our industry-leading growth portfolio positions us to deliver significant sustainable growth in earnings, cash flow and dividends."