Energy Transfer Partners LP's wholly owned subsidiaries, Energy Transfer Interstate Holdings LLC and ET Rover Pipeline LLC have signed an agreement with funds managed by Blackstone Energy Partners and Blackstone Capital Partners for sale of ETP’s 32.44% stake in the Rover Pipeline project to Blackstone. Blackstone will pay $1.57 billion in cash for a 49.9% interest in ET Rover Pipeline, which owns 65% of the natural gas pipeline project.
ET Rover Pipeline and Rover Pipeline LLC are building the 700-mile, 3.25-bcfd pipeline and will operate it once in service. Rover will move gas from the Marcellus and Utica shale production areas to markets across the US and to Union Gas Dawn Hub in Ontario, Canada, for redistribution either back to the States or into the Canadian market.
West Virginia last week told ETP to stop construction of Rover due to environmental violations. Ohio in July had requested civil penalties against Rover for bentonite slurry and other discharges along the project’s route (OGJ Online, July 10, 2017). This action followed the US Federal Energy Regulatory Commission in May having ordered Rover to not begin new horizontal directional drilling for the project as a result of the spills.
ETP expects the transaction to close fourth-quarter 2017, subject to customary conditions. Upon closing, ET Rover will be owned 50.1% by Energy Transfer and 49.9% by Blackstone.