07/11 Closing Prices / revised 07/12/2024 07:42 GMT |        07/11 OPEC Basket   $86.11   +$0.71 cents 07/11 Mexico Basket (MME) $76.61   +$0.44 cents   05/31 Venezuela Basket (Merey)  $70 45   -$4.36 cents| 07/11 NYMEX WTI  August CLQ24  $82.62 +$0.52 cents  | 07/11 ICE Brent Sept  BRNU24  $85.40 +$0.32 cents  | 07/11 NYMEX Gasoline Aug RBQ24  $2.52 +0.6 %  |  07/11 NYMEX  Heating Oil  Aug  RBQ 24    $2.52  -0.5% | 07/11 Natural Gas August NGQ 24   $2.27  -2.6%  | 07/05 Active U.S. Rig Count (Oil & Gas)    585  +4  | 07/12 USD/MXN Mexican Peso   17.7730 (data live)  | 07/12 EUR/USD  1.0869 (data live)  | 07/12 US/Bs. (Bolivar)   $36.53030000 (data BCV)

Kinder Morgan to buy NextEra Energy Partners’ Texas pipelines for $1.82 bln – Reuters

The headquarters of U.S. energy exporter and pipeline operator Kinder Morgan Inc. is seen in Houston, Texas, U.S. September 27, 2020. Picture taken September 27, 2020. REUTERS/Gary McWilliams
The headquarters of U.S. energy exporter and pipeline operator Kinder Morgan Inc. is seen in Houston, Texas, U.S. September 27, 2020. Picture taken September 27, 2020. (Gary McWilliams/Reuters)

Seher Dareen and Sourasis Bose, Reuters

EnergiesNet.com 11 06 2023

U.S. pipeline operator Kinder Morgan (KMI.N) said on Monday it would acquire NextEra Energy Partners’ (NEP.N) gas pipelines in South Texas for $1.82 billion.

The oil and gas pipeline business has seen increased consolidation this year as U.S. production grows and persisting problems related to permits for new pipelines have made existing operators more valuable.

NextEra Energy Partners’ (NEP) Texas natural gas pipeline portfolio, STX Midstream, primarily consists of seven pipelines which provide natural gas to Mexico and power producers and municipalities in South Texas. The pipelines together have a transport capacity of 4.9 billion cubic feet per day.

“Initially, we plan to fund the transaction with cash on hand and short-term borrowings,” Kinder Morgan said in a statement.

The deal is expected to close in the first quarter of 2024.

Shares of NEP, a unit of NextEra Energy (NEE.N) created to acquire, manage and own contracted energy projects, have lost about 44% of their value since Sept. 27 when the company trimmed its distribution growth forecast through at least 2026.

Higher interest rates have raised project costs for NEP, hurting its growth, according to analysts.

“Upon closing, the proceeds would be sufficient to pay off the outstanding project-related debt,” NextEra Energy Partners’ CEO John Ketchum said in a statement.

The sale price represents an about 10 times multiple on the estimated calendar-year 2023 adjusted core profit for the Texas natural gas pipeline portfolio, NEP said.

“The valuation falls in line with recent trading multiples for midstream sector constituents and below some of the transaction marks,” analysts at Guggenheim Securities said.

However, the deal provides some flexibility in credit metrics, the analysts added.

Reporting by Seher Dareen and Sourasis Bose in Bengaluru; Editing by Shilpi Majumdar

reuters.com 11 06 2023

Share this news

Support EnergiesNet.com

By Elio Ohep · Launched in 1999 under Petroleumworld.com

Information & News on Latin America’s Energy, Oil, Gas, Renewables, Climate, Technology, Politics and Social issues

Contact : editor@petroleuworld.com

CopyRight©1999-2021, EnergiesNet.com™  / Elio Ohep – All rights reserved

This site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission fromPetroleumworld or the copyright owner of the material.

Scroll to Top