Private-equity firm Blackstone Group LP is in talks to buy a stake in assets owned by Energy Transfer Partners LP, the company building the controversial Dakota Access pipeline, a source familiar with the situation said on Thursday.
Blackstone is discussing joining the deal with Jamie Welch, who previously served as chief financial officer of ETP parent Energy Transfer Equity LP.
The deal is expected to be valued at about $5 billion or more, the Wall Street Journal, who first reported the proposed deals, said earlier on Thursday.
Blackstone declined to comment while Energy Transfer Partners did not immediately respond to requests for comment. The source requested anonymity because the conversations are not public.
It could not be immediately determined whether the stake would support the Dakota Access pipeline, which has been the subject of protests for months because its route runs adjacent Native American land in North Dakota. Protesters have argued that the 1,172-mile (1,885-km) project would damage sacred lands and could contaminate the tribe's water source.
The U.S. Army Corps of Engineers earlier this month rejected an application for the pipeline to tunnel under Lake Oahe, a reservoir formed by a dam on the Missouri River.
Energy Transfer Partners responded in a joint statement with partner Sunoco Logistics Partners, with whom it announced it would combine earlier this month, that it does not intend to reroute the line and called the Obama administration's decision a "political action."
U.S. President-elect Donald Trump, who until June had a stake in ETP, has said he is in favor of the pipeline project.
Blackstone Chairman and CEO Steve Schwarzman was recently picked by Trump to chair a panel of business leaders who will give him advice.
Schwarzman has said he expects to see a "very substantial reversal of regulations of all types," for the financial sector in the wake of Trump's election.
Sunoco and Energy Transfer Partners are both controlled by general partner Energy Transfer Equity LP. Jamie Welch served as CFO of ETE until he was fired following his attempt to buy Williams Companies Inc, a deal which ultimately fell apart amid pressure from falling oil prices.
(Reporting by Divya Grover in Bengaluru and Lauren Hirsch and New York; Editing by Shounak Dasgupta and Andrew Hay)