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Williams closes C$1.4B sale of Canadian NGL assets; Marathon CEO sees battles ahead for midstream permitting

closed itsacquisition ofWilliams Cos. Inc.and Williams PartnersLP's Canadian NGL businesses for C$1.35 billion in cash, beforeadjustments.

Tofacilitate Williams Partners' consent to the sale, Williams agreed to waiveUS$150 million of incentive distribution rights in the next quarter. Theremaining sale amount was divided at about US$839 million for Williams Partnersand about US$220 million for Williams, according to a Sept. 23 news release.

Theassets include two NGL and olefin liquids extraction plants near Fort McMurray,Alberta, a fractionator near Redwater, Alberta, and a pipeline systemconnecting the facilities. Inter Pipeline will also take on the potentialconstruction of a C$1.85 billion propane dehydrogenation facility near theRedwater fractionator, which would convert locally sourced propane intopolymer-grade propylene, commonly used in plastics manufacturing.

Whilethe U.S. oil and gas industry has met the challenge of low commodity prices bydriving costs down, the biggest threat to the industry's growth is regulatory,Marathon Petroleum Corp.CEO Gary Heminger told shale gas executives in Pittsburgh.

"Inthe pipeline industry, there is no better example than the administration'srecent decision to delay the Bakken Pipeline System after the developers followed allthe rules and a federal judge shot down a lawsuit trying to stop theproject," Heminger said in a speech to open the Shale Insight 2016conference. "It's disturbing that how some regulations are applied dependsnot necessarily on the law itself but on the individuals in charge of enforcingthe rules," Heminger said. "This approach is at odds with ourcharacter as a nation of laws and certainly isn't conducive to a flourishingbusiness environment."

Heminger'saddress set the tone for a conference that has evolved over its five-yearhistory from a showcase for gas producers to this year's emphasis on how totransport billions of cubic feet per day of natural gas and liquids to markets.

Thepropane market moved slightly higher during the week ended Sept. 23 as supportwas taken from stronger exports as well as a rebound in crude oil and naturalgas prices. Demand for propane fell to a more-than-five-year low and added somepressure to the market.

LoneStar pipeline grade propane at Mont Belvieu, Texas, rose 1.50 cents to trade at50.05 cents per gallon in the week ended Sept. 23, while non-LST propane gained1.60 cents to trade at 49.95 cents per gallon. Prices at the hub in Conway,Kan., also increased 1.60 cents, and traded at 44.85 cents per gallon.

ASempra Energysubsidiary won Mexico's antitrust commission approval to acquire PEMEX's 50%equity interest in the Gasoductos de Chihuahua joint venture for approximately$1.1 billion.

Thedeal was announced inJuly 2015. The assets included in the transaction comprise three natural gaspipelines, an ethane pipeline and a liquid petroleum gas pipeline andassociated storage terminal.