2011-01-12-2011-01-04

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Estimated Price
$230.0MM
Description

Plans to buy Langley processing complexin KY, gaining 100 MMcf/d cryogenic processing plant, a 75 MMcf/d refrigeration processing plant & approximately 28,000 horsepower of compression.

MarkWest Energy Partners LP, Denver, (NYSE: MWE) plans to buy a natural gas processing complex in Langley, Ky. and an associated natural gas liquids (NGL) pipeline for $230 million.

The Langley processing complex includes a 100-million-cubic-feet-per-day cryogenic processing plant, a 75-million-cubic-feet per day refrigeration processing plant, and approximately 28,000 horsepower of compression.

Following the deal closing, MarkWest will begin installing a new 60 million-cubic-feet per day cryogenic processing plant to expand the Langley capacity. EQT will also execute a long-term agreement with MarkWest to provide processing services for its Kentucky Huron/Berea shale gas and to extend its existing agreement with MarkWest for NGL transportation, fractionation and marketing services until 2022.

MarkWest will also complete the Ranger NGL pipeline, which is under construction, to allow NGLs recovered at the Langley processing complex to be delivered to MarkWest's Siloam fractionation, storage and marketing complex in South Shore, Ky. In 2008, MarkWest expanded the Siloam fractionator to a capacity of 24,000 barrels per day, in part to support the continued growth of EQT's Huron/Berea shale development in Kentucky and West Virginia. MarkWest will also process EQT's liquids-rich Marcellus gas in West Virginia.

EQT president and chief executive David Porges says, "The sale of these valuable Kentucky assets is the first step in our commitment to prioritize our capital to our most profitable investment opportunities, which for us means development activities, primarily in the Marcellus and also in the Huron/Berea, rather than processing activities."

MarkWest chairman, president and CEO Frank Semple says, "For more than 20 years we have been a leader in providing highly efficient and fully integrated NGL processing, fractionation, and marketing services in Appalachia. This transaction expands and complements our extensive midstream systems that serve the Huron/Berea and Marcellus shales and will provide strategic, long-term value to EQT."

The deal is expected to close during the first quarter 2011.