American Energy, EMG form midstream unit

June 18, 2014
American Energy Partners LP (AEP) and The Energy & Minerals Group (EMG) have formed American Energy–Midstream LLC (AE-MidCo) to focus on areas where affiliates of both companies have active upstream operations.

American Energy Partners LP (AEP) and The Energy & Minerals Group (EMG) have formed American Energy–Midstream LLC (AE-MidCo) to focus on areas where affiliates of both companies have active upstream operations.

AE-MidCo plans to build a portfolio of midstream assets focused on natural gas gathering and processing systems and long-haul pipelines associated with American Energy–Woodford LLC (AEW), American Energy–Utica LLC (AEU), American Energy–Marcellus LLC (AEM), and American Energy–Permian Basin LLC (AEPB).

AELP earlier this month entered into the Permian and southern Marcellus while expanding its Utica acreage in deals totaling $4.25 billion (OGJ Online, June 9, 2014). AELP, founded by Aubrey K. McClendon in April 2013, provides management services to AEU, AEW, AEM, and AEPB, while EMG is the lead equity investor in each.

This deal marks the latest in a series of company transactions focusing capital toward unconventional midstream gas operations. This month alone four such deals were reported: Navitas Midstream Partners and Crestwood Midstream Partners LP each received investments of as much as $500 million (OGJ Online, June 5, 2014; June 17, 2014), Noble Energy Inc. and Consol Energy Inc. launched a Marcellus master limited partnership (OGJ Online, June 12, 2014), and Williams purchased Access Midstream Partners LP for $5.995 billion (OGJ Online, June 16, 2014).