Enbridge has agreed to acquire Tallgrass Energy's crude transportation business for $2.55 billion in cash, adding major pipeline and storage assets connecting U.S. Rockies production with the Cushing, Oklahoma, oil hub. The transaction includes a 75% interest in the 1,050-mile Pony Express Pipeline, which has capacity of roughly 460,000 barrels per day and links Rockies crude production with Cushing and around 500,000 bpd of refining capacity. Enbridge will also acquire a 51% interest in the Powder River Gateway system, which includes two pipelines with combined capacity of about 240,000 bpd, as well as approximately 8.4 million barrels of crude storage across nine terminals. Enbridge said the $2.55 billion purchase price represents an estimated forward enterprise value-to-EBITDA multiple of between 10 and 11 times, and the deal also includes the PXP2 expansion project, a roughly $300 million investment expected to lift Pony Express capacity to approximately 515,000 bpd under take-or-pay contracts with service expected in late 2027. Once the transaction closes, Enbridge plans to add PXP2 to its secured growth backlog, currently valued at $41 billion, and the company said an equity offering will partly finance both this acquisition and its August agreement to acquire Salt Creek Midstream's crude gathering business. The transaction remains subject to regulatory approvals, including U.S. antitrust clearance, and is expected to close later in 2026.
Enbridge IncEnbridge agrees to acquire Tallgrass's crude transportation business for $2.55B, adding pipeline and storage assets to its secured growth backlog.
Tallgrass Energy is selling its crude transportation business to Enbridge for $2.55B in cash.
