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Pacific drops out of pipeline play

Pacific Northern Gas Ltd. is dropping out of a pipeline project planned in northwestern B.C. The company plans to sell its 50 per cent stake in Pacific Trail Pipelines Ltd. (PTP) for $50 million to Apache Canada Ltd. and EOC Resources Canada Inc.

Pacific Northern Gas Ltd. is dropping out of a pipeline project planned in northwestern B.C.

The company plans to sell its 50 per cent stake in Pacific Trail Pipelines Ltd. (PTP) for $50 million to Apache Canada Ltd. and EOC Resources Canada Inc., PTP's other project partners.

Following the sale's completion Apache and EOC will own 50.5 per cent and 49.5 per cent of PTP, respectively.

As part of the deal, Pacific Northern Gas will receive its first payment of $30 million upon closing. It will get the final payment when Apache and EOC decide to proceed with construction of the Kitimat liquefied natural gas facility.

Said Roy Dyce, PNG's president and CEO, "We did not initiate the transaction, but negotiating with our partners was the right thing to do."


from Western Investor June 2011