Enbridge Inc. has agreed to acquire the crude oil business of Tallgrass Energy for approximately US$2.55 billion in cash, strengthening its position in North American liquids transportation and expanding its presence in the US Rockies region.
The transaction includes a 75% interest in the Pony Express Pipeline, a 1050-mile crude oil system with capacity of roughly 460,000 bpd that transports production from the Rockies to Cushing, Oklahoma. The deal also includes a 51% stake in the Powder River Gateway system, consisting of two crude oil pipelines with a combined capacity of about 240,000 bpd, approximately 8.4 million barrels of storage capacity across nine connected crude terminals, and the Stanchion Energy crude marketing business.
According to Enbridge, the acquisition creates a strategic connection between the Bakken, Powder River Basin, and Denver-Julesburg Basin through Cushing while complementing the company’s existing Express-Platte system. The company expects the assets to generate significant free cash flow, support future growth opportunities and create operational synergies across its broader liquids pipeline network.
“The Pony Express system is a premier crude oil corridor connecting some of North America’s most productive basins with key refining and market centers,” said Colin Gruending, executive vice president and president of Enbridge Liquids Pipelines. “These assets complement our broader North American footprint. As operator of Pony Express, we look forward to leveraging Enbridge’s proven operational capabilities to safely and reliably serve customers across the system.”
Pony Express is heavily contracted through the remainder of the decade with predominantly investment-grade counterparties, providing a stable revenue base for the business. Enbridge noted that takeaway capacity from the Denver-Julesburg and Powder River basins remains closely aligned with expected production growth, supporting long-term utilization and contract renewal prospects.
The acquisition also includes the Pony Express PXP2 expansion project, a US$300 million capacity increase that is expected to raise throughput capability to approximately 515,000 bpd. Supported by take-or-pay contracts, the project is slated to enter service in late 2027 and will be added to Enbridge’s US$41 billion secured growth backlog following completion of the transaction.
Based in Calgary, Alberta, Canada, Enbridge operates one of North America’s largest energy infrastructure networks, including crude oil, natural gas, and renewable power assets. The company continues to invest in traditional and emerging energy systems, including hydrogen, renewable natural gas, and carbon capture and storage technologies.
