QEP Midstream Partners Announces Agreement To Purchase Membership Interests In
Green River Processing From QEP Resources For $230 Million
DENVER, May 7, 2014
DENVER, May 7, 2014 /PRNewswire/ --QEP Midstream Partners, LP (NYSE: QEPM)
(the "Partnership") today announced that it has entered into a Purchase and
Sale Agreement to acquire 40% of the outstanding membership interest in Green
River Processing, LLC ("Green River Processing") for $230 million in cash from
QEP Field Services Company, a wholly owned subsidiary of QEP Resources, Inc.
(NYSE: QEP) ("QEP"). This transaction represents the Partnership's first
acquisition following its initial public offering in August 2013. The
acquisition is expected to be immediately accretive to the Partnership's
distributable cash flow per unit. The transaction is expected to close on or
about July 1, 2014, subject to customary closing conditions. The Partnership
will finance the acquisition with borrowings under its revolving credit
QEP Midstream Partners, LP logo.
At closing, Green River Processing will own the Blacks Fork processing complex
and the Emigrant Trail processing plant located in southwest Wyoming. Green
River Processing will own four processing plants with total processing
capacity of 890 MMcf per day, natural gas liquids ("NGLs") fractionation
capacity of 15,000 bbl per day, interconnects to six interstate natural gas
pipelines, and direct pipeline access to the Mt. Belvieu and Conway NGL
markets. In 2013, total inlet volumes for Green River Processing were
approximately 201 million MMBtu, of which 65% were processed under fee-based
processing agreements and 35% were processed under keep-whole processing
The Blacks Fork complex contains three processing plants with up to 505 MMcf
per day of cryogenic processing capacity and a 330 MMcf per day Joule-Thomson
processing plant. In addition, the complex has 15,000 bbl per day of
fractionation capacity and associated truck and rail loading facilities, which
allow Green River Processing to sell purity products into what are often
premium priced local and regional NGL markets. The majority of gas processed
at the Blacks Forks complex is produced in the Pinedale Anticline which is
approximately 100 miles north of the complex.
The Emigrant Trail processing plant, located approximately ten miles south of
the Blacks Fork complex, consists of one cryogenic gas processing train with
inlet capacity of approximately 55 MMcf per day. The plant receives the
majority of its gas from various gas fields along the Moxa Arch, including
Church Buttes, located in the Green River Basin of western Wyoming. The
inlets of the Emigrant Trail plant and the Blacks Fork Complex are
interconnected allowing raw gas to be processed at either or both facilities.
The terms of the acquisition were approved by the Board of Directors of the
General Partner of the Partnership, based on the approval and recommendation
of the Conflicts Committee, which is comprised entirely of independent
directors. The Conflicts Committee was advised by Tudor, Pickering, Holt & Co.
regarding financial matters and Andrews Kurth LLP regarding legal matters.
About QEP Midstream Partners, LP
QEP Midstream Partners, LP is a master limited partnership formed by QEP
Resources, Inc. to own, operate, acquire and develop midstream assets. The
Partnership provides midstream gathering services to QEP and third-party
companies in the Green River, Uinta and Williston basins. Further information
about the Partnership is available at www.qepm.com.
This release includes forward-looking statements within the meaning of Section
27(a) of the Securities Act of 1933, as amended, and Section 21(e) of the
Securities Exchange Act of 1934, as amended. Forward-looking statements can
be identified by words such as "anticipates," "believes," "forecasts,"
"plans," "estimates," "expects," "should," "will" or other similar
expressions. These forward-looking statements include statements regarding
the anticipated closing date of the transactions, the relative benefits to the
parties and equity interest holders resulting from the transaction and the
operational and performance metrics of the Green River Processing assets.
Such statements are based on management's current expectations, estimates and
projections, which are subject to a wide range of uncertainties and business
risks. Actual results may differ materially from those included in the
forward-looking statements due to a number of factors, including the price of
natural gas, oil and NGLs, the inability of the parties to satisfy the
conditions to the transaction, disruptions of any party's ongoing business,
weather conditions, global geopolitical and macroeconomic factors, the U.S.
federal budget, acts of terrorism, and the other risks discussed in the
Partnership's filings with the Securities and Exchange Commission, including
the Risk Factors section of the Partnership's Annual Report on Form 10-K for
the year ended December 31, 2013. The Partnership undertakes no obligation to
publicly correct or update the forward-looking statements in this news
release, in other documents, or on its website to reflect future events or
circumstances. All such statements are expressly qualified by this cautionary
QEP Midstream Partners, LP
Greg Bensen Brent Rockwood
Director, Investor Relations Director, Communications
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SOURCE QEP Midstream Partners, LP
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