By the OGJ Online Staff
HOUSTON, Sept. 10 -- TEPPCO Partners LLP, Houston, will acquire the Jonah gas gathering system in Wyoming from Alberta Energy Co. Ltd. for $360 million, AEC reported Monday.
AEC acquired the Jonah system when it bought McMurry Oil in June 2000. The system will be operated by Duke Energy Field Services, a unit of Duke Energy Corp., Charlotte, NC, on behalf of TEPPCO, which is the general partner of Texas Eastern Products Pipeline Co. LLC.
TEPPCO said the acquisition will give it 300 miles of pipeline, five compressor stations, and related metering facilities. The purchase is expected to close by the end of September.
AEC CEO Gwyn Morgan said the company retained long-term gas transportation agreements on the system to assure "competitive market access for our growing Wyoming production." He said the sale will have no impact on AEC's gas operating or transportation costs.
The Jonah system is undergoing an expansion to increase throughput to more than 700 MMcfd from 460 MMcfd of natural gas.
AEC said it expects to record a gain of $100 million (Can.) on the sale. Proceeds will be used to reduce bank debt. AEC said its forecast for midstream operating cash flow remains unchanged at about $300 million (Can.) in 2001.
AEC, which operates primarily in western Canada, the US Rockies, and Ecuador last year set a target to double production from existing assets within 5 years.