Hess agrees to sell energy marketing unit
Hess Corp., as part of its withdrawal from downstream operations, has agreed to sell its energy marketing business to Direct Energy Business LLC for $1.025 billion.
The buyer is a North American subsidiary of Centrica PLC, London.
Hess completed its exit from refining early this year when it closed its 70,000-b/d catalytic cracking operation at Port Reading, NJ (OGJ Online, Jan. 29, 2013).
Sale of its energy marketing business will push total proceeds from all divestitures this year, including some upstream, to $4.5 billion, the company said.
Direct Energy will pay $731 million cash plus net working capital estimated at $300 million to acquire what it described as one of the largest business-to-business energy suppliers in the eastern US.
The business to be acquired operates in 18 states. Last year it delivered 378 bcf of natural gas and 28 Tw-hr of electric power to more than 23,000 customers.
Direct Energy last year supplied 77 bcf of gas and 51 Tw-hr of power. With the Hess purchase, it said, it will become the largest business-gas supplier on the US East Coast and the second-largest business-power supplier in US retail markets.