QEP Resources Inc. said it will pursue a separation of its midstream business, QEP Field Services Co., including the company’s interest in QEP Midstream Partners LP (QEPMP). QEP Resources is majority owner of QEPMP.
The split is driven by QEP Resources’ board’s conclusion that the separation of QEP Field Services from QEP will benefit the company in the following ways:
• It allows for the separate valuation of QEP’s midstream business.
• The value of QEP’s midstream business is not fully recognized in the QEP share price and a separation is expected to unlock shareholder value.
• It allows each business to independently deploy resources and allocate capital according to their strategic initiatives and growth strategies.
• It permits each business to compete more effectively in their respective markets.
QEP Resources said it expects to update shareholders on the progress of the separation in first-quarter 2014. Meanwhile, it will continue to operate its business as normal and will continue to support ongoing activities.
QEP Resources holds assets in the northern US, primarily in the Rockies and the Williston basin (OGJ Online, Aug. 24, 2012), along with the southern US, primarily in Oklahoma, the Texas Panhandle, and Louisiana. The company was spun off from Salt Lake City-based Questar Corp. in 2010 (OGJ Online, July 2, 2010).