Penn Virginia Completes Chief Gathering Purchase

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Close Date
Estimated Price
$1,060.0MM
Description

Bought Chief Gathering LLC which has six natural gas gathering systems covering more than 300,000 dedicated acres in Bradford, Lycoming, Sullivan, Susquehanna, Wyoming & Greene cos., PA & Preston Co., West Virginia.

Penn Virginia Resource Partners LP, Radnor, Pa., (NYSE: PVR) has completed the acquisition of Chief Gathering LLC from Chief E&D Holdings LP for $1.06 billion in cash and units.

Penn Virginia Resource paid $850 million in cash and approximately 10.35 million units of a new class of PVR limited partner interests.

Chief Gathering's assets include six natural gas gathering systems serving over 300,000 dedicated acres in Bradford, Lycoming, Sullivan, Susquehanna, Wyoming and Greene Counties, Pennsylvania and Preston County, West Virginia.

Additionally, Chief Gathering is currently constructing a new 750 million cubic feet per day trunkline, anticipated to be in service in the third quarter of 2012, extending from northern Wyoming County to Luzerne County with a connection to Transco's interstate pipeline. PVR currently owns two gathering systems in Lycoming and Wyoming Counties, with a third system in early stage development in Susquehanna County.

William H. Shea Jr., chief executive of PVR's general partner, says, “The acquisition of the Chief Gathering systems, along with the continued development of our gathering systems in Lycoming and Wyoming Counties, Pennsylvania, clearly position PVR as the leading independent midstream service provider in the northeastern area of the Marcellus shale. We are privileged to serve a significant roster of major producers that have a long-term view and commitment to energy development in six of the most prolific counties in the Marcellus. The expansion of our trunkline and gathering systems, coupled with the complementary geographic location of Chief's gathering systems allows us to better service the midstream needs of our current customers, and positions us to offer a flexible and efficient gathering solution to other producers in the region."