A unit of Tulsa-based Williams on Friday completed the initial phase of a South Texas asset sale to a Houston-based subsidiary of Enbridge Inc. Last October, the Canadian-based Enbridge agreed to purchase South Texas natural gas gathering, treating and transmission assets from Williams for approximately $50 million (see Daily GPI, Oct. 12, 2001).

The first part of the closing covers 298 miles of gas gathering lines, a sour gas treatment plant near Tilden, TX, and an inactive gas processing plant in Bee County, TX. The remainder of the sale, expected to close in the third quarter of 2002, includes 492 miles of Transco transmission lines in far southern Texas that are regulated by the Federal Energy Regulatory Commission.

The deal was the first acquisition for Enbridge’s Transportation Group South, which is based in Houston and includes for former Midcoast Energy assets, which Enbridge bought last year. The group has overall responsibility for Enbridge’s U.S. business activities. The assets will be owned and operated by Enbridge’s wholly owned subsidiary, Enbridge Midcoast Energy Inc.

Alan Armstrong, vice president of gathering and processing for Williams, said, “The sale allows us to focus on our core midstream growth areas throughout the Rockies, Canada and offshore Gulf of Mexico.'”

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