Enbridge to Buy Tallgrass Crude Business in $2.55 Billion U.S. Expansion

A pipeline into Cushing

Enbridge said it will expand further in the United States by acquiring Tallgrass Energy's crude oil business for $2.55 billion. The package includes a 75% interest in the Pony Express pipeline, a 460,000-barrel-a-day line from the Rockies to Cushing, Oklahoma.

The company plans to pay by issuing about 38.9 million shares for proceeds of roughly $2.6 billion. The stock slipped on the dilution even as the strategic map grew.

Why Cushing still matters

Cushing is a pricing hub. Owning more pipe into that tank farm is a bet that inland crude will keep needing a regulated, contracted path even when coastal politics are loud.

The close is the next headline

Regulators, financing and integration of the Tallgrass assets have to finish before the barrels on the slide deck become Enbridge throughput.