Berkshire Hathaway's Energy Reach -- January 12, 2022

From a reader this morning;

In the political arena, and for the US consumer, killing the Keystone XL, was a true travesty. 

In the environmental arena, it was an even bigger travesty. Faux environmentalists felt that killing the Keystone XL would kill western Canadian heavy oil. Nope. They found a work-around and record amounts of heavy oil is making its way to the Gulf coast. The short term work-around was CBR. The longer-term work-around was expansion of existing pipelines.

But for investors, killing the Keystone XL was one of the best things that could have ever happened. Who benefited? Investors in:

• Berkshire Hathaway (BRK-B)
• Enbridge (ENB)
• BNSF (wholly owned by Berkshire Hathaway)

Now, let's take a look at a story I completely missed. From S&P Global, February 10, 2020. I do not know if these deals were all approved by regulators and were closed, but I assume they were. These were electric transmission lines, not crude oil pipelines.

Canadian and U.S. subsidiaries of Berkshire Hathaway Energy have agreed to buy all of the shares of Enbridge Inc.'s Montana Alberta Tie Line, a 300-MW conduit that can carry power to grids in both regions, according to regulatory filings in both countries.

In a Feb. 7 filing with a commission of the Canada Energy Regulator, Enbridge said it "wishes to advise the commission that it has agreed to transfer 100% of the issued and outstanding shares of MATL [Montana Alberta Tie Line] to BHE Canada Holdings Corporation pursuant to a share purchase agreement dated January 17, 2020, subject to certain conditions." BHE Canada is an affiliate of Iowa-based Berkshire Hathaway Energy.

On Jan. 31, another Berkshire Hathaway Energy unit, BHE U.S. Transmission LLC, applied to the U.S. Federal Energy Regulatory Commission for approval to acquire the U.S. portion of the line. (FERC Docket EC20-34)

The Montana Alberta Tie Line, which went into service in 2013, is a 230-kV merchant line that and connects power grids in the two jurisdictions. While the system has two-way capability, it was mostly designed to move wind-generated electricity from Montana to Alberta, and all of the capacity moving north is secured under long-term agreements. The Canadian portion of the 345-kilometer line stretches about 123 kilometers to a substation at Picture Butte in southern Alberta, owned by AltaLink Holdings LP, which is a separate Berkshire Hathaway Energy subsidiary. The U.S. portion of the line runs to Great Falls, Montana.

I think the takeaways from this short note are pretty obvious and I won't elaborate.