Energy Transfer Equity closes deal to acquire Regency GP

DALLAS, Texas - Energy Transfer Equity LP said on May 26 that it has closed its acquisition of the general partner of Regency Energy Partners LP.
The deal means Energy Transfer Equity now owns the general partner of both pipeline firm Energy Transfer Partners LP and natural gas company Regency. Both will operate as separate entities.
In addition, Regency said it has closed on its purchase of nearly all of Energy Transfer Equity's stake in the Midcontinent Express Pipeline, which gives Regency a total of 49.9 percent of the pipeline. The Midcontinent Express Pipeline is about 500 miles long and extends from Oklahoma to Alabama.
Energy Transfer Equity used its preferred units worth about $300 million to buy all of Regency's general partner from an affiliate of GE Energy Financial Services.
The deal was announced May 11.

Energy Transfer Equity acquiring Regency Energy Partners GP

Regency Energy Partners LP (Nasdaq: RGNC) announced on May 11 that Energy Transfer Equity, L.P. (NYSE: ETE) will acquire the general partner interest in Regency Energy Partners LP from an affiliate of GE Energy Financial Services, a unit of GE. In addition, Regency will acquire a 49.9 percent ownership interest in the Midcontinent Express Pipeline from Energy Transfer Equity, L.P.
ETE will acquire a 100 percent interest in Regency's general partner from an affiliate of GE Energy Financial Services for ETE preferred units with a value of approximately $300 million. Affiliates of GE Energy Financial Services will retain their 24.7 million limited partner units and will be Regency's second largest unitholder, holding 21 percent of Regency's common units after giving effect to the transaction.
In addition, GE Energy Financial Services will have the right to name two board members to the Regency board of directors and one board member to the ETE board of directors.
ETE will own the general partner of both Energy Transfer Partners, L.P. (NYSE: ETP) and Regency. Regency and Energy Transfer Partners (ETP) will operate as separate entities, both with publicly traded limited partner units.
"Energy Transfer Equity is an experienced midstream leader with a strong track record of supporting its limited partnership, assisting ETP in obtaining investment grade status and growing its distributable cash flow," said Byron Kelley, chairman, president and chief executive officer of Regency. "Once the transaction closes, we look forward to calling upon ETE's expertise and extensive knowledge while continuing to focus on implementing the strategic growth objectives we have set for Regency."
Regency also announced on May 11 that it has entered into a definitive agreement to purchase a 49.9 percent interest in the Midcontinent Express Pipeline from ETE. Regency will fund the transaction through the issuance of approximately 26.27 million Regency limited partner units to ETE. ETE will hold 22 percent of Regency's common units after giving effect to the transaction.

OSHA cites three companies in fatal Midcontinent Express accident

JACKSON, Miss. - Three companies are being cited by the U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) for exposing workers to hazards during the construction of gas pipeline meter stations in Mississippi.
Mustang Engineering L.P., Grand Bluff Construction LLC and Priority Energy Services received citations for failing to protect their workers after one died and three others were critically injured.
OSHA began its investigation after a July 2009 explosion at a meter station construction site in Raleigh, Miss., killed one worker. A second Priority Energy Services worker was critically injured, along with two Grand Bluff Construction workers.
"This tragedy could have been avoided if the companies involved had followed government and industry standards when conducting their
pressure tests," said Clyde Payne, director of OSHA's Jackson Area
Office.

Kinder Morgan wins permission to operate pipelines at more pressure

HOUSTON - Pipeline transportation and energy storage company Kinder Morgan Energy Partners LP said on Oct. 8 that it has received authorization from the Pipeline and Hazardous Materials Safety Administration (PHMSA) to increase the maximum allowable operating pressure (MAOP) on selected segments of three major natural gas pipelines that it operates from 72 to 80 percent of design.
The authorization will allow the Kinder Morgan Louisiana, Midcontinent Express and Rockies Express pipelines to provide their full current contracted capacity levels.
Pressure on a Kinder Morgan Louisiana pipeline will be increased to the 80 percent of design MAOP on the whole pipeline and will have 3.2 billion cubic feet (Bcf) per day of capacity.
The Midcontinent Express Pipeline (MEP) pressure will be increased to the 80 percent of design MAOP on approximately 267 miles of Zone 1 for capacity of 1.4 Bcf per day. MEP's Zone 2 has a current capacity of nearly 1.0 Bcf per day.
The Rockies Express Pipeline (REX) pressure will be increased to capacity of 1.8 Bcf per day upon implementation of the 80 percent of design pressure from the Cheyenne Hub in Colorado to the Lebanon Hub in Ohio.

Kinder Morgan, Energy Transfer get FERC OK to expand Midcontinent Express

WASHINGTON - Kinder Morgan Energy Partners LP and Energy Transfer Partners LP have won U.S. approval to expand capacity on their 507-mile Midcontinent Express natural gas pipeline.
The Federal Energy Regulatory Commission announced the decision at an open meeting on Sept. 17 in Washington.
The Midcontinent Express is a joint venture of Kinder Morgan, based in Houston, and Energy Transfer, based in Dallas. The pipeline brings gas from southeast Oklahoma, across Texas and into Alabama.
“The project will provide access to new, growing sources of natural gas supplies with minimal adverse impacts,” according to a summary of the decision provided by the commission.

MarkWest, ArcLight place Arkoma Connector in service

The 50-mile Arkoma Connector interstate natural gas transmission line was placed in service in July.
In May 2009, MarkWest Energy Partners, LP, and an affiliate of ArcLight Capital Partners, announced the formation of a joint venture to own and operate the Arkoma Connector, which provides 638,000 dekatherms per day of Woodford Shale takeaway capacity and interconnects with Midcontinent Express Pipeline and Gulf Crossing Pipeline at Bennington, Okla.
Under the terms of the joint venture agreement, ArcLight acquired a 50 percent equity interest in the joint venture for $62.5 million.
MarkWest will receive a service fee for operating and managing the joint venture. MarkWest and ArcLight will invest equally in the ongoing costs to operate or expand the pipeline.

Rest of Midcontinent Express Pipeline placed in service

HOUSTON - Construction of the 500-mile Midcontinent Express Pipeline (MEP) is complete and natural gas transportation service began on Aug. 1, on the pipeline from Delhi, La., to Transcontinental Pipe Line's Station 85 in Butler, Ala. It was the last leg of the pipelines that was placed in service. Interim service had begun on the pipeline from Bennington, Okla., to Delhi in April.
MEP is a joint venture of Kinder Morgan Energy Partners, L.P. and Energy Transfer Partners, L.P.
"We are delighted that the final leg of the Midcontinent Express Pipeline is in service," said Steve Kean, president of Kinder Morgan's Natural Gas Pipelines group. Kinder Morgan constructed and will operate the pipeline.
"The completion of this final segment of MEP affords shippers and producers in the Barnett Shale, Bossier Sands and other producing regions access to markets in the eastern United States," said Lee Hanse, senior vice president of Energy Transfer's Interstate Pipeline group.
MEP has multiple receipt and delivery points along the pipeline system, which originates in southeast Oklahoma, crosses northeast Texas, northern Louisiana and central Mississippi and ends in Alabama. Capacity is currently up to 1.25 billion cubic feet (Bcf) per day in Zone 1, which interconnects with the Columbia Gulf Transmission system in Delhi and up to 0.84 Bcf per day in Zone 2, which interconnects with the Transcontinental Gas Pipe Line system in Butler.