American Energy – Midstream LLC (AE-MidCo) is changing its name to Traverse Midstream Partners LLC and is transitioning to a stand-alone company, fully independent of the broader American Energy Partners LP (AELP) platform, a process that has been contemplated since the company's founding in June 2014 and that will be effective on July 1.
Traverse Midstream has been capitalized by a $500 million equity commitment provided by the Energy & Minerals Group, and additional equity provided by Aubrey. K. McClendon and other members of AELP management and affiliated parties of McClendon.
Traverse Midstream has two investments in midstream infrastructure designed to serve the Appalachian shale basins. The company has a 35% non-operating equity interest in Rover Pipeline LLC, a 710-mile interstate natural gas pipeline company majority owned and operated by Energy Transfer Partners LP (ETP). The Rover Pipeline project will allow for natural gas pipeline service to its shippers from the Marcellus and Utica production areas to markets in the Midwest, Great Lakes, and Gulf Coast regions of the US, and to the Union Gas Dawn Hub in Ontario, Canada, through its connection to the Vector Pipeline.
The Rover Pipeline is supported by 15- and 20-year fee-based contracts to transport over 3 billion cubic feet per day (Bcf/d) of natural gas. Transportation from the supply regions to the Midwest Hub near Defiance, Ohio, is expected to begin by the end of 2016 to serve the Gulf Coast and Midwest markets. The remaining service to other markets including Michigan and the Union Gas Dawn Hub will be in service by mid-2017.
Traverse Midstream also has a 25% non-operating equity interest in the Ohio River System, which includes construction of a 52-mile, 36-inch gas gathering trunkline that will be capable of delivering up to 2.1 Bcf/d to Rockies Express Pipeline and Texas Eastern Transmission on the southern end of the line and an additional 1.4 Bcf/d through a 12-mile, 30-inch lateral to the interstate grid on the northern end of the line, which will bring overall system deliverability to 3.5 Bcf/d. The Ohio River System will access Monroe, Belmont, Jefferson, and Harrison counties in eastern Ohio and is expected to be in service in the third quarter of 2015. This project is also majority owned and operated by ETP.