DT Midstream announces US$1.2 billion acquisition of strategic Midwest FERC-regulated natural gas pipelines
Published by Alfred Hamer,
Editorial Assistant
World Pipelines,
DT Midstream, Inc. has announced that it has reached an agreement to acquire a portfolio of three FERC-regulated natural gas transmission pipelines from ONEOK, Inc. for US$1.2 billion. The pipelines have a total capacity of more than 3.7 billion f3/d with approximately 1300 miles across seven states in the attractive Midwest market region which is expected to experience continued growth in power demand. The acquisition price represents an approximately 10.5x 2025 EBITDA multiple.
Under the terms of the agreement, DT Midstream will acquire 100% operating ownership in Guardian Pipeline, Midwestern Gas Transmission and Viking Gas Transmission. Guardian Pipeline, L.L.C. is an approximately 260 mile interstate pipeline which is interconnected to DT Midstream’s Vector Pipeline, the Chicago Hub and serves key Wisconsin demand centres.
Midwestern Gas Transmission is an approximately 400 mile bi-directional interstate pipeline which connects Appalachia supply to the Midwest market region between Tennessee and the Chicago Hub. The pipeline has an interconnection with Guardian Pipeline. Viking Gas Transmission is an approximately 675 mile interstate pipeline which connects key utility customers in Minnesota, Wisconsin and North Dakota to Canadian supply at Emerson, Manitoba.
“Expanding our scale through this bolt-on natural gas pipeline acquisition fully aligns with our pure play natural gas strategy. This transaction also increases the revenue contribution from our pipeline segment, supported by take-or-pay contracts with strong credit quality utility customers” said David Slater, President and CEO. “We look forward to welcoming the team members that support these premier assets, both in field operations and in DT Midstream’s new Tulsa office,” added Slater.
Jeff Jewell, Executive Vice President and CFO of DT Midstream, said “This transaction will be immediately accretive to Distributable Cash Flow, improves our business profile, and adds to the backlog of future growth opportunities.”
Read the article online at: https://www.worldpipelines.com/business-news/20112024/dt-midstream-announces-us12-billion-acquisition-of-strategic-midwest-ferc-regulated-natural-gas-pipelines/
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