EQT Selling West Virginia Gathering System to EQT Midstream Partners
EQT Corporation and EQT Midstream Partners LP have agreed to terms of EQT Midstream’s acquisition of the Northern West Virginia Marcellus Gathering System, along with a preferred interest in an EQT subsidiary, for $1.05 billion.
EQT will receive $997.5 million in cash and $52.5 million in common and general partner units. In addition, EQT Midstream will fund approximately $370 million of system expansion projects over the next several years.
The gathering system was designed and constructed to gather natural gas production in the wet gas and dry gas regions of the Marcellus; specifically in the Saturn, Mercury, Pandora and Pluto development areas. The system includes approximately 70 miles of natural gas gathering pipeline and nine compressor units with 25,000 hp of compression.
In addition, the system includes a 30-mile, high-pressure wet gas header pipeline that moves wet gas from the development areas to the MarkWest Mobley processing facility. EQT contracted for 10-years of firm capacity on the system.
EQT Midstream expects to install approximately 100 miles of gathering pipeline and five compressor units with 23,700 hp of compression over the next several years. Ongoing maintenance capital expenditures related to the system are forecast to be less than $5 million per year.
EQT currently holds approximately 76,000 net acres in northern West Virginia that surround the acquired gathering system, including 59,000 net undeveloped acres. As of Dec. 31, 2014, there were 199 Marcellus wells and 20 Upper Devonian wells being serviced by the gathering system, with an average daily gathered volume of approximately 410 MMcf per day.
Tags: EQT, EQT Midstream Partners, West Virginia
Comments are closed here.