(Reuters) -Canada's Enbridge said on Thursday that Stonlasec8 Indigenous Alliance will buy a 12.5% stake in the pipeline operator's Westcoast system for C$715 million ($511.19 million), as Indigenous communities look to own stake in energy firms.

The pipeline system stretches over 2,900 kilometers from northeast British Columbia (B.C.) and the B.C.-Alberta border to the Canada-U.S. border, with a capacity of 3.6 billion cubic feet of natural gas per day.

Canada's First Nations are increasingly buying stakes in Canadian energy projects as they seek economic benefits from projects on their land, while companies look to raise capital.

The Canadian government is also interested in selling a stake of its C$34 billion Trans Mountain oil pipeline to Indigenous groups.

Enbridge said that a unit of Canada Development Investment Corporation will provide C$400 million in loans to the Alliance, which represents 36 First Nations in B.C.

The transaction is expected to close by the end of the second quarter.

($1 = 1.3987 Canadian dollars)

(Reporting by Tanay Dhumal in Bengaluru; Editing by Vijay Kishore)