Atlas Pipeline to buy Cardinal Midstream

Atlas Pipeline Partners LP has agreed to buy Cardinal Midstream LLC. Owned or operated assets will include three cryogenic processing plants totaling 220 MMcfd capacity, about 66 miles of associated pipelines, and a gas treating business including 17 treatment plants in assorted hydrocarbon basins.

Assets being acquired by Atlas include:

• The 120-MMcfd cryogenic processing Tupelo plant in the Arkoma Woodford basin.

• About 60 miles of pipeline gathering both rich and lean gas.

• 28,500 hp of compression, including a 42 MMcfd compression and treating plant.

• A gas treating business including contract operations in the Woodford, Eagle Ford, Granite Wash, Avalon, Haynesville, and Fayetteville shales, with 15 amine treating sites and two propane refrigeration plants.

Atlas will also acquire Cardinal’s 60% operating interest in the Centrahoma Processing LLC (OGJ Online, Oct. 11, 2010) joint venture with MarkWest Energy Partners LP.

Centrahoma includes the 80-MMcfd Coalgate and 20-MMcfd Atoka cryogenic gas processing plants and 15 miles of NGL pipeline.

All three acquired processing facilities currently operate at full capacity. Centrahoma plans to expand in 2013 by building the 120-MMcfd Stonewall processing plant, scalable to 200 MMcfd if demand warrants.

Atlas paid $600 million cash for Cardinal and expects the transaction to close by yearend, subject to regulatory approvals, closing conditions, and purchase price adjustments.

Earlier this year, Atlas brought online a 60-MMcfd expansion to its Velma cryogenic gas processing plant in the Woodford, boosting total capacity to 160 MMcfd (OGJ Online, June 27, 2012).

Contact Christopher E. Smith at chriss@ogjonline.com.

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