BP Acquires North American Natural Gas Assets
BP Gas and Power North America announced it has agreed to purchase a set of natural gas marketing and trading assets from TransCanada PipeLines Limited. The assets include Cibola Energy Services Corporation, an Omaha based natural gas marketing and trading company that has an extensive transportation, storage and customer portfolio in the U.S. Midwest and Mid Continent.
The acquisition will further establish BP as a leader in the North American energy marketing and merchant business while significantly enhancing its core role as a premier supplier of energy products and services.
BP will also acquire a number of transportation contracts on TransCanada's Alberta System and Mainline and on Foothills Pipe Lines and CanStates Marketing, an Alberta supply aggregation business. TransCanada will also assign to BP the contracts related to the management of assets and supply to SEMCO Energy Gas Company. SEMCO is a Michigan based utility serving over 250,000 customers. The acquisition includes natural gas sales of approximately 1.6 billion cubic feet per day.
Said Brian Frank, President of BP Gas & Power Canada: "This transaction is another important step in the development of our gas marketing and trading business in North America because it will expand our energy product marketing presence into new areas. We will also have the benefit of additional assets in order to serve our existing customer base, as well as access to new customers in Canada, the U.S. Pacific Northwest, Midwest and Northeast."
He added: "Cibola has an excellent reputation for customer service and we intend to build upon that. BP intends to retain the Omaha-based employees involved in the transaction. We believe they will be an integral part of BP's growth strategy for the region."
The transaction is scheduled to close in the fourth quarter and is subject to a number of terms and conditions including regulatory approval in Canada. Terms of the agreement were not disclosed.