American Midstream to pay $115M for DCP Midstream assets
American Midstream Partners LP reports the execution of a purchase and sale agreement with an affiliate of DCP Midstream LLC to acquire entities holding onshore natural gas processing and offshore natural gas gathering and transportation and oil gathering assets for consideration of $115 million.
The acquisition complements American Midstream's High Point system located in southeast Louisiana, and improves its ability to compete for increased shallow-water and deepwater production from new drilling in the eastern region of the Gulf of Mexico. The assets to be acquired include the Mobile Bay gas processing plant, the Dauphin Island gathering and transmission system, and DCP's interest in the Main Pass Oil Gathering system.
The acquisition is expected to be funded through the private placement of American Midstream common units.
Construction of Seaway Pipeline loop completed
Enterprise Products Partners LP and Enbridge Inc. report that the 512-mile loop of the Seaway Pipeline system from Cushing, Oklahoma, to the Jones Creek storage and terminal facility near Freeport, Texas, is mechanically complete. The new 30-inch Seaway Loop Pipeline is expected to more than double the capacity of the Seaway system to 850,000 b/d.
The Jones Creek facility is connected to Enterprise's ECHO crude oil storage facility in Houston by a 65-mile, 36-inch pipeline. Construction of a 100-mile, 30-inch pipeline from ECHO to Beaumont/Port Arthur, Texas, is expected to be complete at press time. Commissioning of the Seaway Loop, as well as the new pipeline from ECHO to Beaumont/Port Arthur, will continue throughout 3Q14.
In addition to the pipeline that transports crude oil from Cushing to the Gulf Coast, the Seaway system comprises a terminal and distribution network originating in Texas City, Texas, which serves refineries locally and in the Houston area. The Seaway system also includes dock facilities at Freeport and Texas City.
The Seaway Pipeline system is owned by Seaway Crude Pipeline Company LLC, a 50/50 joint venture owned by affiliates of Enterprise Products Partners and Enbridge.
Regency Energy closes Eagle Rock acquisition
Regency Energy Partners LP has closed on its acquisition of the midstream business of Eagle Rock Energy Partners LP for a combination of cash, Regency common units, and assumption of indebtedness. Regency issued approximately 8.2 million Regency common units to Eagle Rock and assumed approximately $500 million of outstanding Eagle Rock senior notes and exchanged those notes into Regency senior notes.
Regency will fund the cash consideration with proceeds from a $400 million private placement of Regency common units to a subsidiary of Energy Transfer Equity LP, the owner of Regency's general partner, and borrowings under Regency's revolving credit facility.
"The acquisition will complement Regency's core gathering and processing business, and when combined with the recent acquisition of PVR Partners, will strengthen our existing positions in the Texas Panhandle and East Texas," said Mike Bradley, president and CEO of Regency. "In addition, we believe this acquisition will be accretive to our distributable cash flow per common unit, and continue to expect to recommend to our board of directors distribution increases representing a growth rate of 6-8% for 2014."
Eagle Rock's midstream assets include approximately 8,100 miles of gathering pipeline and over 800 MMcf/d of processing plants.
MMLP enters $900M credit facility
Martin Midstream Partners LP has entered into a newly amended $900 million revolving credit facility with commitments from 25 lenders. This agreement replaces the previous credit facility of $637.5 million. The revolving credit facility is the partnership's primary source of liquidity and matures March 28, 2018. As of June 30, the partnership had $290 million outstanding on its revolving credit facility.
Global Partners, Kansas City Southern to develop terminal in Texas
Global Partners LP and Kansas City, MO-based Kansas City Southern (KCS) plan to develop a unit train terminal in Port Arthur, Texas. The waterborne terminal, which will be constructed on a 200-acre parcel leased by Global from KCS, will serve initially as a destination for heavy crude from Western Canada utilizing 340,000 barrels of initial storage capacity. Upon commencement of unit train service, the terminal is expected to have an initial capacity of up to 2 unit trains per day.
"The Port Arthur terminal represents a significant opportunity to capitalize on strong demand for the movement of Western Canadian crude initially to one of the world's premier refining centers in the US Gulf Coast," said KCS president and CEO David L. Starling.
Construction of the terminal is contingent upon Global's receipt of all necessary permits.
Valero Energy to dropdown assets
Valero Energy Partners LP has approved the acquisition from certain subsidiaries of Valero Energy Corp. of the McKee Crude System, Three Rivers Crude System, and Wynnewood Products System for total consideration of $154 million.
The McKee Crude System, located in Sunray, Texas, has 72 Mbbls/d of throughput capacity and supplies approximately 40% of the crude oil processed at VLO's McKee refinery. The system consists of more than 200 miles of pipelines, 20 crude oil truck unloading sites with lease automatic custody transfer units, and approximately 240 Mbbls of storage capacity.
The Three Rivers Crude System, located in the Eagle Ford shale region in South Texas, consists of 11 crude oil truck unloading sites with lease automatic custody transfer units and a 1-mile, 12-inch pipeline with a capacity of 110 Mbbls/d that delivers crude oil to tanks at VLO's Three Rivers refinery.
The Wynnewood Products System, located in Ardmore, Oklahoma, consists of a 30-mile, 12-inch refined petroleum products pipeline with 90 Mbbls/d of capacity and two tanks with a total of 180 Mbbls of storage capacity. The system connects VLO's Ardmore refinery to the Magellan refined products pipeline system and is the primary distribution outlet for the refinery.
Simmons & Company International served as financial advisor to the Conflicts Committee of Valero Energy Partners GP LLC.
Golden Pass files application for LNG project
Golden Pass Products LLC has submitted a formal application with the US Federal Energy Regulatory Commission to construct and operate a proposed LNG export facility at the existing Golden Pass LNG import site in Sabine Pass, TX.
Golden Pass, a joint venture of Qatar Petroleum International and ExxonMobil Corp., started the National Environmental Policy Act prefiling process with FERC in May 2013.
The project has received US Department of Energy authorization for exports to Free-Trade Agreement countries and is awaiting DOE approval to export to non-FTA nations. If approved, Golden Pass expects to invest $10 billion over a five-year period to build the facility.
QEP gains interest in Green River
QEP Midstream Partners LP has acquired 40% of the outstanding membership interest in Green River Processing LLC for $230 million in cash from QEP Field Services Co., a wholly owned subsidiary of QEP Resources Inc.
Green River Processing owns the Blacks Fork natural gas processing complex and the Emigrant Trail natural gas processing plant located in southwest Wyoming. These assets consist of four natural gas processing plants with total processing capacity of 890 MMcf per day, and natural gas liquids (NGL) fractionation capacity of 15,000 bbl per day with interconnects to six interstate natural gas pipelines, and direct pipeline access to the Mt. Belvieu and Conway NGL markets. In 2013, total natural gas inlet volumes for Green River Processing were approximately 201 MMBtu, of which 65% were processed under fee-based processing agreements and 35% were processed under keep-whole processing agreements.
Noble Group, EIG form Harbour Noble Group Ltd. and EIG Global Energy Partners have formed Harbour Energy Ltd., a company that will own and operate upstream and midstream energy assets globally. Noble will be preferred offtake and marketing partner of Harbour Energy, while EIG, together with the company's internal management team, will serve as manager of the company and oversee the acquisition of assets. Harbour Energy's capitalization will be funded solely through balance sheet capital of each of Noble and EIG. Linda Z. Cook, a 29-year veteran of Royal Dutch Shell, has been appointed a managing director of EIG, a member of EIG's executive committee, and CEO of Harbour Energy.
BRIEFS
Fitch publishes two new oil and gas dashboards
Fitch Ratings has published its US Midstream Dashboard and its Crude Oil and Refined Products Pipelines Dashboard. These documents explore themes and trends affecting the credit profiles of US midstream, crude oil pipeline, and refined product pipeline issuers, including the status of NGL, crude oil and refined product inventories; the outlook for pricing among key NGL components; and the current state of supply and demand for NGLs, crude oil, and refined products.
The reports also identify factors influencing credit quality within the sector, and future prospects for energy infrastructure growth throughout the US.
Fitch publishes two new oil and gas dashboards
Fitch Ratings has published its US Midstream Dashboard and its Crude Oil and Refined Products Pipelines Dashboard. These documents explore themes and trends affecting the credit profiles of US midstream, crude oil pipeline, and refined product pipeline issuers, including the status of NGL, crude oil and refined product inventories; the outlook for pricing among key NGL components; and the current state of supply and demand for NGLs, crude oil, and refined products.
The reports also identify factors influencing credit quality within the sector, and future prospects for energy infrastructure growth throughout the US.
