Gas Utility Acquisitions a ‘Once-In-A-Generation Opportunity’
Enbridge acquires trio of U.S. companies from Dominion Energy Inc., creating North America’s largest natural gas utility franchise
About 7,000 employees.
Delivering more than 9 billion cubic feet a day of natural gas.
Destination? About 7 million customers.
That’s about the size of it—North America’s largest natural gas utility franchise, that is—following a trio of transactions announced today between Enbridge and Dominion Energy, Inc.
From Dominion Energy, for an aggregate purchase price of US$14 billion (C$19 billion), Enbridge is acquiring:
- The East Ohio Gas Company, also known as Dominion East Ohio, which serves more than 1.2 million customers across more than 400 communities and 27 counties in Ohio.
- Questar Gas, which serves about 1.2 million customers across Utah—that’s about 97% of households in the state—as well as regions in southwestern Wyoming and Idaho, in addition to its related Wexpro companies.
- The Public Service Company of North Carolina, also known as PSNC Energy, which serves more than 600,000 customers across 28 counties in North Carolina.
With the delivery of 9.3 billion cubic feet per day (Bcf/d) of gas to customers in the U.S. and Canada, upon closing, Enbridge’s gas utility business will be the largest by volume in North America.
“Adding natural gas utilities of this scale and quality, at a historically attractive multiple, is a once-in-a-generation opportunity. The transaction also reinforces our position as the first-choice energy delivery company in North America,” says Greg Ebel, Enbridge’s President and CEO.
“The assets we are acquiring have long, useful lives—and natural gas utilities are ‘must-have’ infrastructure for providing safe, reliable and affordable energy,” adds Mr. Ebel. “The entire Enbridge team is committed to working with the EOG, Questar and PSNC teams, and to investing in the communities they serve. We look forward to serving our customers with dedication, and to providing them with safe, reliable and affordable energy service for years to come.”
With the addition of these gas utility operations in Ohio, Utah, North Carolina, Wyoming and Idaho, Enbridge now has a significant presence in the U.S. utility sector.
Enbridge’s primary gas utility, Enbridge Gas Inc., has a storied 175-year history, and serves about 75% of residents in the Canadian province of Ontario. Enbridge Gas and its affiliate, Gazifère, presently provide safe, reliable service through 3.9 million residential, commercial, institutional and industrial meter connections in Ontario and Quebec.
Among the details of today’s acquisitions:
- East Ohio Gas, which serves the cities of Cleveland, Akron, Canton and Youngstown, has about 22,000 miles of transmission, gathering and distribution pipelines, as well as 60 billion cubic feet (Bcf) of natural gas storage.
- Questar, which serves the Utah cities of Salt Lake City, Provo and St. George, has about 21,000 miles of transmission, gathering and distribution pipelines, and enjoys a unique regulated supply agreement with Wexpro, which can supply up to 65% of Questar’s gas needs without commodity exposure.
- The Public Service Company of North Carolina, which serves the cities of Raleigh, Durham and Asheville, has about 13,000 miles of transmission, gathering and distribution pipelines.
“Today, and for the long-term, natural gas will remain essential for achieving North America’s energy security, affordability and sustainability goals,” says Michele Harradence, Enbridge Executive Vice President and the President of our gas utility business. “We are excited to welcome more than 3,000 new employees into the Enbridge family. In addition, we intend to continue the robust social, community and diversity, equity and inclusion initiatives that each gas utility has committed to.”
Like Enbridge, all three of these companies have well-developed emission reduction plans, have committed to achieving net-zero greenhouse gas (GHG) emissions by 2050, and are already exploring leveraging the critical energy infrastructure they operate to transport low-carbon energy sources such as renewable natural gas and hydrogen.
“These gas utilities have each committed to achieving net-zero greenhouse gas emissions by 2050, and are expected to play a critical role in enabling a sustainable energy transition,” notes Mr. Ebel.
The acquisition of each gas utility is expected to close in 2024.