US-based Atlas Pipeline Partners (APL) has announced that it is purchasing all of the operating assets of Cardinal Midstream, a privately-owned midstream operator, for $600m in cash.
The deal is expected to increase distributable cash flow per unit by 3-5% in 2013 and 8-10% in 2014.
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Estimated earnings before interest, taxes, depreciation and amortisation (EBITDA) from the Cardinal assets will be about $60m in 2013, and about $70m and $80m in 2014 and 2015 respectively.
As part of the transaction, APL will own and operate three cryogenic processing plants with over 220 million cubic feet per day processing capacities, and 66 miles of connected gas gathering pipelines.
It will also include a gas treating business that includes 17 treating facilities located in hydrocarbon basins in Woodford, Eagle Ford, Granite Wash, Avalon, Haynesville and Fayetteville shales.
APL will also acquire a 42 million cubic feet per day compression facility with 28,500 horsepower compression capability, and a treating facility.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataAdditionally, the company will buy 60% stake in the Centrahoma joint venture formed between Cardinal and MarkWest Energy Partners.
Following the completion of the transaction, APL will operate the Centrahoma JV assets, which includes two cryogenic facilities, the Coalgate plant and the Atoka plant, with processing capacities of 80 million cubic feet per day and 20 million cubic feet per day, respectively, and 15 miles of NGL pipeline.
Cardinal and MarkWest earlier decided to expand Centrahoma JV by the end of 2013, by installing a new 120 million cubic feet per day plant, which can be further expanded to 200 million cubic feet per day.
Scheduled to be complete by the end of 2012, the deal is subject to certain regulatory approvals, customary closing conditions and purchase price adjustments.
