Husky Energy Inc., Calgary, is to sell a 65% interest in certain midstream assets in the Lloydminster region of Alberta and Saskatchewan to Cheung Kong Infrastructure Holdings Ltd. and Power Assets Holdings Ltd. (PAH).
Cheung Kong is a global infrastructure company and PAH is a global investor in energy.
Husky will receive $1.7 billion (Can.) of gross cash proceeds and will remain operator with 35% interest in the assets.
The assets include 1,900 km of pipelines in the Lloydminster region and 4.1 million bbl of oil storage capacity at Hardisty and Lloydminster. A new limited partnership will be formed with Husky owning 35%, Cheung Kong, 16.25%, and PAH 48.75%.
The transaction is subject to regulatory approval.
Husky Chief Executive Officer Asim Ghosh said the firm sought partners “who viewed these as top tier assets that provide considerable growth potential.”
Husky said the partners have the funding capacity to build midstream infrastructure associated with planned construction of additional thermal projects in the area (OGJ Online, Apr. 18, 2016).
Husky also reported a net loss of $458 million (Can.) for the first quarter.