Williams Partners to Buy Marcellus Lines for $750 Million
Williams Partners LP (WPZ) agreed to buy pipelines connected to Pennsylvania and New York natural-gas wells from Delphi Midstream Partners LLC for about $750 million in cash and stock, adding capacity where production is rising.
Delphi, owned by American Securities LLC and its management, will get $300 million in cash and about 7.5 million common units in exchange for its Laser Gathering System, Tulsa, Oklahoma- based Williams Partners said in a statement today.
The purchase includes 33 miles (53 kilometers) of pipeline and related equipment in Susquehanna County, Pennsylvania, and 10 miles in New York, said Williams Partners, a master limited partnership controlled by Williams Cos. The partnership will revise its capital spending expectations in February to reflect the acquisition.
The Marcellus Shale, which stretches from Canada to Kentucky, is estimated to hold 262 trillion cubic feet of gas, according to Bloomberg Industries. Production from the formation in Pennsylvania more than doubled in the second quarter to 3.35 billion cubic feet a day from a year earlier.
Williams Partners also will acquire Delphi’s Mansfield gathering system in the Barnett Shale region of Texas, Jeff Pounds, a spokesman, said today in an e-mail. The partnership announced Dec. 1 it was in exclusive talks with Delphi for both systems.
Williams Partners rose less than 1 percent to $59.90 at 11:49 a.m. in New York. The units have gained 28 percent this year.
To contact the reporter on this story: Jim Polson in New York at jpolson@bloomberg.net
To contact the editor responsible for this story: Tina Davis at tinadavis@bloomberg.net
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