Sempra Energy has announced that its subsidiary has entered into an agreement to sell its non-utility US natural gas storage facilities to an affiliate of ArcLight Capital Partners (ArcLight) for US$332 million in cash, subject to adjustments for working capital. The facilities will become part of the Enstor natural gas storage platform, which ArcLight acquired in 2018.
"Our agreement to sell our non-utility US natural gas storage assets is an important component to achieving our portfolio-optimisation goals we announced in June 2018," said Joseph A. Householder, President and Chief Operating Officer of Sempra Energy. "Completing this sale, along with the recently announced sale of our non-utility US solar assets, enables us to reallocate capital to further strengthen our balance sheet and support Sempra Energy's future growth opportunities."
The gas storage assets included in the sale to ArcLight are the Mississippi Hub storage facility in Simpson County, Mississippi, with a working capacity of 22.3 billion ft3 of natural gas, and the Bay Gas storage facility in Southwest Alabama, which comprises five underground caverns with a working capacity of 20.4 billion ft3 of natural gas.
Sempra Energy's subsidiary currently owns approximately 91% of Bay Gas storage facility. Immediately prior to the sale, Sempra Energy's subsidiary will purchase the approximate 9% interest from a minority owner and include it in the sale to ArcLight.
The sale of the non-utility natural gas assets to ArcLight is expected to be completed in 1Q19, subject to customary closing conditions. At closing, ArcLight will own 100% of Mississippi Hub and Bay Gas storage facilities.
Sempra Energy's financial advisor for this transaction is Wells Fargo Securities LLC and its legal advisor is Jones Day.
Read the article online at: https://www.tanksterminals.com/storage-tanks/03012019/sempra-energy-subsidiary-to-sell-us-natural-gas-storage-facilities/