UGI to acquire Columbia Midstream for $1.25 billion

UGI Energy Services LLC, a subsidiary of UGI Corp., has agreed to acquire the equity interests of Columbia Midstream Group LLC (CMG) from a subsidiary of TC Energy Corp., formerly TransCanada Corp., for $1.275 billion.

Jul 3rd, 2019

UGI Energy Services LLC, a subsidiary of UGI Corp., has agreed to acquire the equity interests of Columbia Midstream Group LLC (CMG) from a subsidiary of TC Energy Corp., formerly TransCanada Corp., for $1.275 billion (OGJ Online, May 6, 2019).

CMG owns four natural gas gathering systems and an interest in a company with gathering, processing, and liquids assets. These assets—with capacity of 2.675 million MMbtu/day and 240 miles of pipeline—connect production to markets throughout western Pennsylvania, eastern Ohio, and northern West Virginia. The sale does not include any interest in Columbia Energy Ventures Co. (CEVCO), which is TC Energy’s minerals business in the Appalachian basin.

The deal expands UGI’s midstream portfolio and provides an opportunity to invest an additional $300-500 million over the next 5 years at attractive returns, the company said in a press statement.

“This transaction expands our midstream capabilities in the prolific gas producing region of the Southwest Appalachian basin and provides an initial investment into both wet gas gathering and processing,” said John L. Walsh, UGI president and chief executive officer.

The transaction is expected to close in this year’s third quarter subject to regulatory and other closing conditions.

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