Ruby Pipeline enters into settlement agreement with Pembina

By Wendy Van Sickle

Columbus, Ohio, Nov. 18 – Ruby Pipeline LLC entered into a settlement agreement with Pembina Pipeline Corp. and some of its wholly owned affiliates, according to a news release from Pembina.

Upon approval of the U.S. Bankruptcy Court for the District of Delaware and the payment of all amounts contemplated by the settlement agreement, the terms provide for the release of Pembina from any causes of action arising in connection with prepetition distributions and the bankruptcy case.

In consideration, the settlement agreement provides for Pembina to pay Ruby $102 million.

The bankruptcy court is expected to consider the terms of the settlement agreement at a hearing for Ruby Pipeline's Chapter 11 plan proposed for Jan. 23.

The Chapter 11 plan provides for the potential sale by auction of Ruby's assets with a distribution of the value of the Ruby Pipeline estate to its creditors following confirmation. In the event the plan is approved as currently contemplated, Pembina's affiliates retain all rights to recovery under the 2026 subordinated notes as a creditor after accounting for any rights of subordination in favor of other creditors.

Ruby Pipeline company filed its Chapter 11 plan and related disclosure statement on Nov. 1.

Ruby Pipeline, based in Houston, is a subsidiary of El Paso Corp. and Global Infrastructure Partners LLC. It is a 680-mile natural gas pipeline that stretches from Wyoming to Oregon. The company filed Chapter 11 bankruptcy on March 31, 2022 under case number 22-10278.

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