Enbridge has entered into an agreement with Tonbridge Power to acquire the Montana-Alberta Tie-Line (MATL) power transmission project.
The MATL project, being developed by Tonbridge, is a proposed 345 km transmission line from Great Falls, Mont., to Lethbridge, Alberta, designed to carry wind power.
Enbridge says it plans to offer to acquire all outstanding common shares of Tonbridge for C$20 million through a plan of arrangement. The company also plans to repay approximately C$50 million of debt incurred in the development of MATL.
Enbridge will be entitled to receive approximately C$9 million in a combination of cash and warrants if the arrangement is not completed due to certain circumstances.
Following the acquisition, Enbridge will inject further funding to complete the first 300 MW phase of MATL as well as an expansion of 550 MW to 600 MW.
The total cost to Enbridge for both phases of MATL is expected to be approximately C$300 million, of which approximately half is being funded through a low-cost 30-year loan from the Western Area Power Administration of the U.S. Department of Energy.
Required permits for the first phase of MATL have been obtained, and the project has secured long-term, take-or-pay contracts for the system's entire northbound capacity. In addition, Tonbridge has a 200 km southern extension of MATL, the Green Line, under development.