DTE Energy closes purchase of natural gas midstream assets

Detroit, MI-based DTE Energy has completed the $1.3 billion purchase of midstream natural gas assets in the Southwest Marcellus/Utica region in Pennsylvania and West Virginia.

The completed acquisition includes:

  • 100% of Appalachia Gathering System (AGS) from M3 Midstream LLC
  • 40% of Stonewall Gas Gathering (SGG) from M3 Midstream LLC
  • 15% of SGG from Vega Energy Partners

The Appalachian basin assets include approximately 217 miles of pipeline including gathering capacity of 550 MMcf/d from SGG, connecting producing wells with interconnections with Columbia Gas Transmission, Texas Eastern Transmission and the NEXUS Gas Transmission project, according to a weekly snapshot of oil and gas deal activity written by 1Derrick for OGFJ in early October.  

"Energy companies in the Midwest, including DTE, are in the process of transitioning a good portion of their electrical generation capacity from coal to natural gas," said Gerry Anderson, DTE Energy chairman and CEO.

The assets will become part of the DTE's non-utility Gas Storage and Pipeline business which currently owns and manages a network of natural gas gathering, transmission and storage facilities serving the Midwest, Ontario and Northeast markets.

In early October, DTE financed the transaction through the issuance of $675 million of equity units and the remainder with senior notes.

Wells Fargo Securities LLC served as the exclusive financial advisor to DTE for the transaction.

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