Southcross Energy Partners, LP (Southcross) has announced that it has acquired natural gas pipelines near Corpus Christi, Texas along with contracts related to those pipelines. The purchase price is approximately US$ 40 million in cash and funds for the acquisition were drawn from Southcross' existing credit facility. The pipelines were acquired from Onyx Midstream, LP and Onyx Pipeline Company.
The pipelines, which range from 12 - 24 in. dia., transport natural gas to two power plants in Nueces County, Texas under fixed-fee contracts that extend through 2029. Total length of the pipelines is approximately 50 miles. Natural gas volumes through the pipelines averages 97 million ft3/d during 2013. The transaction is expected to be accretive to Southcross' distributable cash flow during 2014.
"We are expanding our platform with the acquisition of these pipelines," said David Biegler, Chairman and Chief Executive Officer of Southcross' general partner. "They complement our integrated midstream strategy of delivering products toe end-use markets and customers and are significant additions to our pipelines in the Corpus Christi area.”
Adapted from press release by Hannah Priestley-Eaton