MarkWest Energy Partners has said it will acquire 100% of the ownership interests of Keystone Midstream Services for $512m.
Keystone, owned by Stonehenge Energy Resources, Rex Energy Corporation and Sumitomo Corporation, has assets located in Butler County, Pennsylvania, including two cryogenic gas processing plants, a gas gathering system and associated field compression.
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MarkWest expects gas volumes from Keystone to increase to 170 million cubic feet per day at the end of 2013 from the current rate of 40 million cubic feet per day, reaching about 350 million cubic feet per day by 2016.
To support Rex Energy’s drilling programme, MarkWest also announced plans to invest nearly $500m over the next five years to expand the Keystone gathering and processing facilities.
Most of the capital invested by MarkWest will go towards extending its planned natural gas liquids (NGL) gathering system from its Houston, Pennsylvania NGL fractionation complex through Beaver, Lawrence and Butler counties to the Keystone assets, as well as other third party facilities.
MarkWest believes the acquisition will support the NGL gathering extension, and will also enhance the Keystone operations.
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By GlobalDataThe transaction is expected to close during the second quarter of 2012.
