ArcLight Capital Partners has acquired Midcoast Operating LP from Enbridge Inc for about $1.1 billion in cash. Houston-based Midcoast is an owner of midstream assets.
BOSTON, Aug. 1, 2018 /PRNewswire/ — ArcLight Capital Partners announced today that one of its affiliates has acquired Midcoast Operating, L.P. from Enbridge Inc. (TSX: ENB) (NYSE: ENB) for approximately $1.1 billion in cash.
Midcoast consists of three large, legacy gathering and processing systems in Texas and Oklahoma, a long-haul NGL transmission system delivering NGLs from multiple supply areas (including the DJ and Permian basins) to Mont Belvieu, Texas, and a marketing and logistics business. Assets include:
11,900 miles of gas and NGL pipelines;
25 processing plants with over 2 Bcf/d of capacity; and
12 treating plants, an E/P fractionator, and numerous liquid logistics assets (rail, truck, pipeline injection and storage).
Midcoast will be led by an executive team consisting of Rob Bond as CEO, Tommy Stone as COO, and Mike Moran as CCO. Rob, Tommy and Mike have worked together for the better part of the past two decades, most recently as members of the senior leadership team at PennTex Midstream Partners. ArcLight and senior management intend to retain the existing Midcoast field and corporate workforce currently in place. Midcoast will continue to be based in Houston, Texas.
“We are very excited to add the Midcoast platform to our portfolio of midstream investments,” said Dan Revers, Founder and Managing Partner of ArcLight. “We believe Midcoast represents a rare opportunity to acquire a large scale, diversified midstream business with exciting commercial and growth capital investment opportunities. We are likewise excited to partner with a management team that has demonstrated their ability to deliver successful results and prioritize safe and reliable operations in the midstream segment.”
“Midcoast owns a premier set of midstream assets that provide excellent Gulf Coast connectivity for natural gas and NGLs, bridging wide basis differentials that have arisen between producing basins and coastal demand centers. We look forward to leading Midcoast as it pursues these and other exciting opportunities,” added Rob Bond, who will become CEO of the company under ArcLight’s ownership. “Above all, Midcoast enjoys a deep bench of talented executives and employees, and Tommy, Mike and I are excited to work with this team to take Midcoast forward in its next chapter as an independent, growth-oriented company.”
ArcLight is one of the leading private equity firms focused on energy infrastructure investments. Founded in 2001, the firm helped pioneer an asset-based private equity approach to investing in the dynamic energy sector. ArcLight has invested more than $20 billion in over 100 transactions since inception. Based in Boston, the firm’s investment team employs a hands-on value creation strategy that utilizes its in-house technical, operational, and commercial specialists as well as the firm’s 850-person asset management affiliate. More information about ArcLight, and a complete list of ArcLight’s portfolio companies, can be found at www.arclightcapital.com.