Williams, Tulsa, Okla., has agreed to acquire the Haynesville gas gathering and processing assets of Trace Midstream in a deal valued at $950 million.
The transaction, which expands the company’s footprint into the East Texas region of the Haynesville, increases Williams’ gathering capacity in the basin to over 4 bfcd from 1.8 bcfd.
Trace’s Haynesville assets include the Gemini Carthage Pipeline (GCP) system, Endeavor gathering, and Star gathering system. These pipeline systems span Panola and Harrison counties in East Texas and Caddo, Webster, and Bienville parishes in Louisiana, and include more than 240 miles of high and low-pressure pipelines as well as multiple treating and dehydration facilities.
In early 2020, Trace Midstream and Gemini Midstream, each a portfolio company of Quantum Energy Partners, agreed to combine and operate as Trace Midstream, expanding commercial presence in East Texas (OGJ Online, Jan. 31, 2020).
As part of the Williams deal, Trace customer and Quantum affiliate Rockcliff Energy agreed to a long-term capacity commitment in support of Williams’ Louisiana Energy Gateway (LEG) project. The project is designed to gather Haynesville natural gas and connect it to Transco natural gas pipeline system markets and Gulf Coast LNG markets.
Additionally, Williams signed a memorandum of understanding with Quantum to form a joint venture that will enable Quantum to become an equity investor and partner in the project.
The transaction is expected to close in this year’s second quarter subject to regulatory approvals.