Apollo Buys 40% Stake in Canadian Gas Processor PGI

Apollo Funds are set to acquire a significant 40% ownership in Pembina Gas Infrastructure Inc. (PGI), a major player in Western Canada's natural gas processing sector. This strategic move, originating from funds managed by KKR, positions Apollo as a key partner in one of the nation's largest gas processing platforms. Pembina Pipeline Corporation will retain its controlling 60% interest and continue its operational oversight of PGI's extensive network.

PGI, established in 2022 as a joint venture between Pembina and KKR, has rapidly consolidated its position, boasting a combined processing capacity of approximately five billion cubic feet per day. The company's infrastructure includes 23 gas processing plants, nearly 3,900 kilometers of gathering pipelines, and a substantial NGL extraction capability of around 330,000 barrels daily. Its strategic location across Alberta and British Columbia provides critical connectivity to major transmission networks, serving key industrial hubs within the Montney and Duvernay resource plays.

The acquisition underscores Apollo's commitment to the North American energy infrastructure market, a sector experiencing renewed investment driven by demand for reliable energy sources. Scott Browning, a Partner at Apollo, highlighted PGI's strategic placement within what he termed the "Global Industrial Renaissance," emphasizing the company's role in supporting industrial end markets essential for North American energy security. Apollo anticipates deploying further capital into development projects, leveraging Pembina's established operational expertise.

This transaction marks a new chapter for PGI, following its successful development under the joint stewardship of Pembina and KKR. Heather Christie-Burns, President and CEO of PGI, expressed enthusiasm for Apollo's infrastructure acumen and long-term investment horizon, viewing them as an ideal partner for the company's next growth phase. She also acknowledged KKR's foundational role in building PGI into its current leading position.

Scott Burrows, CEO of Pembina Pipeline Corporation, welcomed Apollo, emphasizing PGI's integral role within Pembina's midstream strategy and Western Canadian energy infrastructure. He affirmed Pembina's continued dedication to PGI's operational leadership and strategic direction, expressing confidence in growing the platform alongside Apollo. This partnership is expected to enhance PGI's capacity to meet the evolving energy demands of the region.

From KKR's perspective, the divestment represents a successful realization of their investment thesis in Canadian energy infrastructure. Paul Workman, Managing Director at KKR, noted the compelling market opportunity identified when forming PGI with Pembina, citing the disciplined execution by the PGI management team and Pembina's stewardship as critical to the platform's success. KKR expressed pride in PGI's evolution and wished the team continued prosperity.

The deal is anticipated to finalize by the close of the second quarter of 2026, pending the fulfillment of standard closing conditions. This investment aligns with broader trends of private capital seeking stable, long-term assets in essential infrastructure sectors, particularly those supporting energy transition and security initiatives.