Pennsylvania-based EQM Midstream Partners will boost its Appalachia natural gas gathering capacity by up to 66pc with its acquisition of Hornet Midstream and a majority interest in Eureka Midstream.
The two gathering systems flow about 1.6 Bcf/d (45mn m³/d) of gas, adding to EQM's existing Appalachia footprint of 2.4 Bcf/d of firm contracted gathering capacity.
EQM, which spun off from top US natural gas producer EQT last year, will pay a total of $1mn to acquire Hornet and secure a 60pc interest in Eureka in an agreement with a fund managed by Morgan Stanley Infrastructure Partners. The payment includes $860mn in cash and about $170mn of assumed debt.
Eureka Midstream is a 190-mile (306km) header pipeline system in Ohio and West Virginia. Hornet Midstream is a 15-mile system in West Virginia that interconnects with Eureka. The assets have interconnections with multiple interstate pipeline systems and provide access to four processing plants as well as EQM's lines. The systems flow about 67pc dry-gas and 33pc rich gas.
The midstream assets will complement EQM's existing gathering and transmission system, allowing it to add to its scale and facilitate new commercial opportunities, the company said.
Independent producer EQT in February 2018 separated its midstream business from its production operations, creating EQM. EQM's system includes about 700 miles of high-pressure gathering lines and 950 miles of interstate transmission pipeline.
