Joint Venture to be formed by Williams and CPPIB on $3.8 Billion Marcellus-Utica Shale Gas

Canada Pension Plan Investment Board is joining with U.S. energy firm Williams Cos Inc. in a $3.8 billion joint venture to expand its presence in the North American natural gas market.

The joint venture includes Williams’ Ohio Valley Midstream system in the Marcellus shale basin and the Utica East Ohio Midstream system. Canada’s largest pension fund will have a 35 percent stake in the venture, with Williams holding the rest and operating the combined business, the companies said on Monday.

“This joint venture will provide CPPIB additional exposure to the attractive North American natural gas market, aligning with our growing focus on energy transition,” said Avik Dey, managing director, head of energy & resources, CPPIB.

Williams Cos Inc. holds pipeline assets in the Marcellus and Utica shale basins, the biggest gas-producing region in the United States.


Exxon Mobil, Plains All American Plan Pipeline Project in Permian

Exxon Mobil is planning to build hundred of miles of pipeline in a joint venture with Houston’s Plains All American Pipeline that would stretch from west of Midland to the Houston and Beaumont areas.

The multibillion dollar pipeline network will be designed to deliver crude oil from the Permian Basin to refining and port hubs near Houston.

This news comes after an early 2018 statement by Exxon that said it plans to triple production in the Permian by 2025.

Despite the proposed project, lack of pipelines in the prolific Permian is creating increasing bottlenecks in the area and could hamper growth as well as cause discounts on Permian-produced oil.

With Permian oil production at a record high and rapidly increasing, Plains and Oklahoma-based Magellan Midstream Partners expanded their BridgeTex oil pipeline from West Texas to the Houston region.


Kinder Morgan and Southern Company Announce Southern Natural Gas Pipeline Strategic Venture

Kinder Morgan and Southern Company announced Sunday its natural gas pipeline strategic venture designed to advance both companies’ leadership in energy infrastructure development by way of Southern Company’s acquisition of a 50 percent equity interest in the Southern Natural Gas (SNG) pipeline system, which will continue to be run by Kinder Morgan.

The SNG pipeline system runs for 7,600 miles, connecting natural gas supply basins in Texas, Louisiana, Mississippi, Alabama, and the Gulf of Mexico to markets in Louisiana, Mississippi, Alabama, Florida, Georgia, South Carolina, and Tennessee.

“This transaction is consistent with the infrastructure development strategy we have discussed for well over a year. The company’s strategic venture with Kinder Morgan, combined with our recent additions, AGL Resources and PowerSecure, underscore Southern Company’s leadership position in electricity and natural gas and our commitment to developing America’s energy infrastructure,” said Southern Company Chairman, President and CEO Thomas A. Fanning. “Our new ownership stake in SNG will position Southern Company for future growth opportunities and enhanced access to natural gas, which are expected to benefit customers and investors alike.”

Southern Company and Kinder Morgan, two largely known natural gas leaders in the nation, will work together to advance both companies’ efforts to develop infrastructure that is important to the nation’s energy future.

“Southern Company has been a valued customer of SNG for many years, and this agreement draws on the strengths of both companies,” said Norman G. Holmes, president of Kinder Morgan South Region Pipelines. “We are very pleased to deepen our relationship with them and excited about the growth opportunities this strategic relationship will provide.”

Kinder Morgan president and CEO, Steve Kean, also stated that the company plans to use the proceeds from the transaction to reduce debt at Kinder Morgan, which will push the company another step toward achieving its goal to strengthen its balance sheet and position the company for long-term value creation.

The companies expect to complete the transaction in the third or fourth quarter of this year.

Kinder Morgan