El Paso takes another step in E&P spin-off plan

By Oil & Gas Financial Journal staff

El Paso Corp. (NYSE:EP) has advanced its plans to spin-off its E&P business before year-end 2011. On August 11, the natural gas and related energy products provider filed its initial Form 10 with the US Securities and Exchange Commission. 

The spin-off, first announced in late May 2011, follows on the heels of similar strategies of two other large oil and natural gas companies: Marathon Oil and ConocoPhillips.

The new company, EP Energy Corp., will be listed on the NASDAQ stock exchange under the ticker symbol EPE. Following the completion of the proposed spinoff, El Paso Corp. will be comprised of El Paso's Pipeline Group, its Midstream Group, and its general and limited partner interests in El Paso Pipeline Partners, LP (NYSE: EPB).

“We’re excited about the creation of two outstanding publicly traded companies through the spinoff of our E&P business,” said Doug Foshee, chairman, president, and CEO of El Paso Corp. “We are also excited about the new name for our E&P company—EP Energy. The new name leverages the equity we have built in the El Paso brand, and it speaks directly to what our E&P business does so well: finding and producing oil and natural gas.”

Brent Smolik, who will become president and CEO of EP Energy, said, “While our name will change, many things will not, including the fundamental pillars of our E&P strategy. We have more than 10 years of drilling inventory that we expect will deliver significant growth in oil and condensate revenues. We will continue to focus on maintaining a significant drilling inventory of repeatable programs, being a leader in safe and responsible energy development, and driving high-end performance across our operations.”

El Paso Corp. and EP Energy will move forward with two boards made up of existing El Paso board members.

Foshee will serve as chairman of the El Paso Corp. board and non-executive chairman of EP Energy Corp. J. Michael Talbert will serve as lead director of the board of El Paso Corp.

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