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Westcoast Sells Manitoba LDC

Westcoast Sells Manitoba LDC

Westcoast Energy, a partner in more venturesome natural gas projects, announced it has sold wholly-owned subsidiary Centra Gas Manitoba to Manitoba Hydro for $245 million.

"Large projects such as the Maritimes and Northeast Pipeline and Alliance Pipeline will consume a significant amount of capital," Westcoast Chairman Michael Phelps said, advising the company has a capital spending budget in 1999 of $1.6 billion, "the largest capital budget in the history of the company." Sale of the LDC will help fund some of that.

"The opportunity presented to Westcoast Energy to realize full value for the Centra Gas Manitoba asset at a sale price of some 20 times earnings and 2.1 times book value led us to this decision," Phelps said.

Centra Gas Manitoba is the primary distributor in the province with 6,500 kilometres of pipeline and secondary distribution lines delivering about 63 Bcf annually.

With 240,000 customers it is a much smaller unit than Westcoast's largest distribution company, Union Gas of Ontario, which has over a million customers.

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