UGI to Acquire Stonehenge Appalachia Midstream Natural Gas Gathering System

UGI Corporation announced that its subsidiary, UGI Energy Services, (UGIES), has entered into a definitive agreement to acquire Stonehenge Appalachia, (Stonehenge) from Stonehenge Energy Holdings, LLC for approximately $190 million. This investment is expected to be immediately accretive to adjusted earnings.

The Stonehenge system, located in Butler County, Pennsylvania, includes more than 47 miles of pipeline and associated compression assets, and has gathering capacity of 130 million cubic feet per day.

“We are very pleased with this investment and the opportunity to grow our presence in the Appalachian Basin,” said Robert F. Beard, Executive Vice President – Natural Gas, Global Engineering, Construction and Procurement. “When we acquired the assets of Columbia Midstream Group in 2019, we committed to additional investments to build or buy quality systems in the region.”

The acquisition of Stonehenge, in addition to UGI’s recent purchase of an ownership stake in the Pine Run gathering system, demonstrates the company’s commitment to the Appalachian basin, which averaged a record 31.9 billion cubic feet per day of production in the first half of 2021, the highest for a six-month period since production began in 2008, Beard said.

“Importantly, this transaction has stable cash flows that are underpinned by a long-term contract with minimum volume commitments and significant acreage dedications in some of the most prolific production areas in the Appalachian Basin,” he said.

The transaction is subject to customary regulatory and other closing conditions, including Federal antitrust clearance pursuant to the U.S. Hart-Scott-Rodino Antitrust Improvements Act. Assuming fulfillment of all conditions, the transaction is expected to close by Jan. 31.

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