Log in or Register for enhanced features | Forgotten Password?
White Papers | Suppliers | Events | Report Store | Companies | Dining Club | Videos

Oil & Gas
Transportation & Storage
Return to: EBR Home | Oil & Gas | Transportation & Storage

Noble Energy to divest 50% stake in Cone Gathering for $765m

EBR Staff Writer Published 19 May 2017

Oil and natural gas exploration and production firm Noble Energy has agreed to divest its 50% stake in a company that operates pipelines in the Marcellus Shale to Quantum Energy Partners for $765m.

Noble Energy would sell a holding firm that has a 50% stake in Cone Gathering, a company that owns the general partner of publicly traded pipeline firm Cone Midstream Partners, which is based in Pennsylvania.

The limited partnership units represent a 33.5% ownership interest in CONE Midstream Partners.

Noble Energy's cumulative 2017 divestiture proceeds total nearly $2bn, with the amount primarily representing an exit of the company's Appalachia upstream and midstream businesses.

The company is using proceeds announced so far to cover the cash costs associated with the Clayton Williams Energy acquisition.

It will further strengthen the balance sheet through debt reduction, and offer further financial capacity to support the company's onshore oil development in the US.

Subject to customary closing conditions and adjustments, the deal is expected to complete in the third quarter of this year.

Cone Midstream Partners owns, operates, develops and acquires natural gas gathering and other midstream energy assets to support production in the Marcellus Shale in Pennsylvania and West Virginia.

The firm has natural gas gathering pipelines and compression and dehydration facilities, as well as condensate gathering, collection, separation and stabilization facilities.

Noble Energy chairman, president and CEO David Stover said: "CNNX has performed exceptionally well since its IPO in late 2014, exceeding forecasts despite a challenging macro-economic backdrop.

“Including this transaction, Noble Energy will realize more than $1 billion in total value from our Marcellus midstream business, which represents approximately three times our net invested capital.”

Quantum Energy Partners president Dheeraj Verma said: “Quantum is excited to once again work with Noble Energy on a substantial acquisition. This transaction follows the recently announced sale of Noble Energy's upstream Appalachia assets to a separate portfolio company of Quantum.”