OMERS Infrastructure to acquire 50% interest in BridgeTex pipeline

Plains All American Pipeline, Magellan Midstream Partners and OMERS, the defined benefit pension plan for municipal employees in Ontario, Canada, have announced that certain of their subsidiaries have entered into a definitive agreement whereby Plains and Magellan will collectively sell a 50% interest in BridgeTex Pipeline Company for $1.438 billion.

OMERS will acquire a 30% interest from Plains and a 20% interest from Magellan, with Plains and Magellan each receiving a proportionate share of the total purchase price. Following closing, OMERS will own a 50% interest, Plains will retain a 20% interest, and Magellan will continue to operate the BridgeTex pipeline and own a 30% interest. The transaction is expected to close in the fourth quarter of 2018, subject to the satisfaction of customary closing conditions.

BridgeTex owns the BridgeTex pipeline, a 400,000 barrel-per-day crude oil pipeline system that extends from Colorado City in West Texas to Houston, with further connectivity for BridgeTex shippers to the Texas City area. At Colorado City, BridgeTex pipeline sources crude oil from Plains’ Basin and Sunrise pipeline systems. BridgeTex delivers volumes into Magellan’s East Houston terminal and Magellan’s Houston crude oil distribution system with connection to refineries in Houston and Texas City as well as to marine export capabilities via Magellan’s Seabrook Logistics joint venture terminal. BridgeTex pipeline capacity is being expanded to 440,000 barrels per day by early 2019.

Barclays served as financial advisor for Plains, and Jefferies advised OMERS. Legal advisors included: Vinson & Elkins LLP for Plains, GableGotwals for Magellan and Sidley Austin LLP for OMERS.