Crestwood Equity Partners completes sale of Tres Palacios Gas Storage
Published by Rosalie Starling,
Editor - Hydrocarbon Engineering
World Pipelines,
Crestwood Equity Partners LP (CEQP) and Crestwood Midstream Partners LP (CMLP) have announced that Crestwood Equity has completed the previously announced sale of Tres Palacios Gas Storage LLC to the newly formed joint venture between Crestwood Midstream and an affiliate of Brookfield Infrastructure Group for total cash consideration of US$130 million. Crestwood Midstream will own 50.01% of Tres Palacios Holdings LLC (TPH) and will be the operator of Tres Palacios and its assets.
As part of the transaction, Brookfield Infrastructure has entered into five-year, fixed-fee contracts with Tres Palacios for 15 billion ft3 of firm storage capacity and 150 000 dkth/d of enhanced interruptible wheeling services, effective 1 November 2014.
“We are pleased to complete the sale of Tres Palacios to TPH LLC,” stated Robert G. Phillips, Chairman, President and Chief Executive Officer of Crestwood’s general partners. “This transaction is an important step in establishing Crestwood Equity as a pure-play general partner MLP and positions Tres Palacios with the much broader financial resources ofCrestwood Midstream and Brookfield Infrastructure to capture expansion opportunities along the Texas Gulf Coastregion. We look forward to working closely with Brookfield Infrastructure as a partner, which has a proven track record of developing energy assets throughout North America.”
Crestwood Midstream funded its US$65 million portion of the purchase price utilising its US$1.0 billion revolving credit facility. Crestwood Equity utilised the total cash received from the sale to repay approximately US$130 million of outstanding borrowings under its revolving credit facility. Pro forma for this transaction, Crestwood Equity’s leverage ratio as defined in its revolving credit facility would have been 3.4x as of 30 September 2014.
Adapted from press release by Rosalie Starling
Read the article online at: https://www.worldpipelines.com/business-news/11122014/crestwood-equity-partners-completes-sale-of-tres-palacios-gas-storage-1120/
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