NextEra Energy Partners LP has finalized the acquisitions of NET Midstream and the 149-MW Jericho Wind Energy Center and closed $600 million of term loans, completing its financing for the acquisitions.
NET Midstream includes a portfolio of seven long-term contracted natural gas pipeline assets in Texas.
“I’m very pleased that we have completed the necessary financing and closed these two acquisitions, which support our growth strategy,” said Jim Robo, NextEra chief executive officer and chairman. “The NET Midstream acquisition establishes NextEra Energy Partners’ presence in the long-term contracted natural gas pipeline space and complements the partnership’s existing renewables portfolio by reducing the impact of resource variability on our total portfolio."
NET Midstream’s seven natural gas pipelines serve power producers and municipalities in south Texas, processing plants and producers in the Eagle Ford Shale and residential, commercial and industrial customers in the Houston area.
The largest pipeline in the portfolio, NET Mexico, provides a source of natural gas transportation for low-cost U.S.-sourced shale gas to Mexico under a 20-year ship-or-pay contract with a subsidiary of Pemex Gas Y Petroquimica Basica, a division of the Mexican state-owned oil and gas company.
The NET Midstream acquisition totaled about $2.1 billion -- $934 million in cash consideration and $654 million in existing debt.
The Jericho Wind Energy Center was acquired by NextEraEnergy Partners’ sponsor NextEra Energy Resources for about $210 in cash consideration, plus about $19 million in working capital and $294 million in existing debt.
“The Jericho acquisition further expands NextEra Energy Partners’ renewables portfolio, demonstrating the strength of the pipeline for dropdowns from its sponsor,” said Robo. “We expect both of these acquisitions to provide attractive yields to our investors and we continue to view NextEra Energy Partners as the premier yieldco in the space.”
The Jericho Wind Energy Center brings NextEra Energy Partners’ renewables portfolio to more than 2,072 MW.