Northern Border Partners LP announced plans yesterday toincrease its position in the Powder River Basin with the purchaseof gas gatherer Bear Paw Energy LLC for $370 million from aconsortium of investors led by Bear Paw Energy Management and J.P.Morgan Partners.

Under the letter of intent, the purchase price will be paid $185million in Northern Border Partners common units and the remainderin cash and the assumption of liabilities. The purchase is targetedfor completion by the end of first quarter

Bear Paw Energy has extensive gathering and processingoperations in the Powder River Basin in Wyoming and the WillistonBasin in Montana, North Dakota and Saskatchewan. Bear Paw has226,000 acres under dedication and 600 miles of high and lowpressure gathering pipelines in the Powder River. In the WillistonBasin, Bear Paw has over 2,800 miles of gathering pipelines andfour processing plants with 90 MMcf/d of capacity.

“Once completed, we will have added over $625 million innon-regulated assets to the Partnership with our third majoracquisition in a little over one year. Our total mix ofnon-regulated businesses will be slightly over 25%,” said NorthernBorder Partners CEO Bill Cordes. “These strategically locatedassets will fit, both commercially and operationally with CrestoneEnergy Ventures and Northern Border Pipeline.”

The company expects the transaction to be immediately accretiveto earnings and cash flow.

Northern Border Partners owns a 70% general partner interest inNorthern Border Pipeline Company, which owns a 1,214-mileinterstate pipeline system from the Montana-Saskatchewan border tomarkets in the Midwest. Through Crestone Energy Ventures, thepartnership owns interests in Crestone Gathering Services (100%),Bighorn Gas Gathering (49%), Fort Union Gas Gathering (33.33%) andLost Creek Gathering (35%) in the Powder River and Wind RiverBasins in Wyoming.

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