The Williams Cos. has acquired NorTex Midstream, a fully contracted natural gas pipeline and storage asset in north Texas, the company said on Sept. 8.
The $423 million transaction with an affiliate of Tailwater Capital, which closed on Aug. 31, includes about 80 miles of natural gas transmission pipelines and 36 Bcf of natural gas storage in the Dallas-Fort Worth market. The assets provide service to about 4 GW of gas-fired power generation. They also position Williams to provide storage services for Permian gas directed toward growing Gulf Coast LNG demand.
Tailwater acquired NorTex in February 2021, shortly after Winter Storm Uri hit Texas. As one of the only operational natural gas storage facilities supplying the North Texas region during the storm, NorTex played a pivotal role supporting natural gas power generators and utilities. The company delivered more than 5 Bcf of natural gas to its customers and provided enough natural gas to heat and power approximately 380,000 homes, saving customers more than $800 million or the equivalent of over $2,100 per household.
“Serving one the fastest growing population centers in the United States, this irreplaceable natural gas infrastructure is critical to bridging the gap between limited supplies and periods of peak demand, while supporting the viability of intermittent renewables like solar and wind,” said Williams President and CEO Alan Armstrong. “During the extreme cold of Winter Storm Uri, the NorTex pipeline and storage facilities reliably provided gas to residential customers and electric power plants throughout the entire storm. We see significant upside to integrating these assets, especially when combined with our existing transmission and storage capabilities.”
BofA Securities acted as exclusive financial adviser to Williams, and Davis Polk and Wardwell LLP served as legal counsel to Williams. Wells Fargo Securities LLC acted as exclusive financial adviser to Tailwater and NorTex, and Kirkland & Ellis served as legal counsel to Tailwater and NorTex.
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