EQT Corp. sells midstream assets
Published by Anna Nicklin,
Assistant Editor
World Pipelines,
EQT Corporation has recently announced that it has sold the Allegheny Valley Connector (AVC) pipeline along with several Marcellus gathering systems to EQT Midstream Partners, LP (EQM). The acquisition, which was effective from 1 October, is estimated at approximately US$275 million.
The Federal Energy Regulatory Commission (FERC) regulates the AVC, which includes approximately 209 miles of transmission pipeline and 11 billion ft3 of working gas storage capacity. The AVC system has a transmission capacity of 450 million ft3/d.
EQM expects to invest approximately US$50 million in AVC-related projects in the remainder of 2016 throughout 2017. EQM expects the AVC to generate earnings before interest, taxes, depreciation and amortisation (EBITDA) of US$31 million in 2017, increasing to U$35 million in 2018.
The gathering assets consist primarily of the Applegate, McIntosh and Terra systems in Pennsylvania, along with the Taurus system in West Virginia. This amounts to approximately 87 miles of gathering pipeline, an estimated 7000 hp of compression and 370 million ft3/d of gathering capacity.
EQT committed to a total of 235 million ft3/d of firm capacity under a 10 year contract on the systems. EQM expects to invest approximately US$105 million over several years to complete planned expansion projects, including the installation of approximately 20 miles of gathering pipeline and four compressor units with 20 000 hp of compression.
Upon completion of the expansion projects, EQT’s total firm capacity will increase to 365 million ft3/d. EQM expects the gathering systems to generate EBITDA of US$16 million in 2017, increasing to US$30 million in 2018.
Read the article online at: https://www.worldpipelines.com/business-news/17102016/eqt-corp-sells-midstream-assets/
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