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Dominion Terminates Questar Pipeline Sale To Berkshire Hathaway
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On July 12, 2021, Dominion Energy and Berkshire Hathaway Energy issued separate statements that the firm had put the intended sale of the Questar Pipeline Group on hold due to regulatory clearance issues.
The Questar Pipeline delivers natural gas and deposits it beneath the ground near substantial reserves in six major producing regions in the Rocky Mountains, including the Uinta, Greater Green River, and Piceance basins.
Berkshire Hathaway Energy, a subsidiary of Berkshire Hathaway Inc.—the multinational guided by famed billionaire Warren Buffett—agreed to buy Questar Pipeline last year as part of its almost $10 billion Dominion's gas sector purchase.
According to Berkshire Hathaway and Dominion Energy, the postponed Questar Pipeline deal has no impact on the acquisition of storage assets and gas transmission to Berkshire Hathaway Energy, expected to complete in November 2020.
"The option is a result of continued uncertainty associated with gaining clearance from the Federal Trade Commission under the Hart-Scott-Rodino Antitrust Improvements Act of 1976," Dominion noted in a report.
Furthermore, the canceled deal has no impact on Berkshire Hathaway Energy's sale of gas distribution and storage assets in November 2020. The sale was about the initial transaction amount, according to the press releases of the corporation.
The transaction included the acquisition of 100% of Dominion Energy Transmission and Carolina Gas Transmission, 50% of Iroquois Gas Transmission System, and a stake in Maryland's Cove Point LNG facility, in addition to Questar Pipeline. The asset value of the financing transaction, which comprises the assumption of debt, is $9.7 billion.
On July 12, Dominion said that it continues to regard Questar Pipeline as a terminated company. Also, it would initiate a fair market sale by the end of 2021.
Dominion also said that it intends to take out a one-year term loan to pay Berkshire Hathaway Energy the $1.3 billion purchase price. The company plans to pay off the debt using revenues from a future sale of Questar Pipelines to a new client.
The Rationale Behind The Agreement
Dominion Energy's gas storage and transportation infrastructure, and $5.7 billion in debt, were purchased by Berkshire Hathaway. To complete the transaction, it will invest approximately $4 billion in cash. Employees at the impacted sites will soon be moved to Berkshire Hathaway Energy, at the same time, without job losses yet disclosed.
According to a statement, they utilized the profits from the deal to purchase back Dominion Energy shares. The decision is part of the company's strategic repositioning towards government and utility operations for sustainable development.
Later that day, the company announced that it no longer works with Duke Energy on the Atlantic Coast pipeline. Dominion Energy also said in a statement that the decision was made due to "ongoing delays and increasing cost uncertainty."
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A $2 billion deal saw Dominion Energy sell Questar Pipelines to Southwest Gas
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A good asset will not sit on the market for long. After a deal with Berkshire Hathaway fell through, Dominion Energy managed to secure another one for Questar Pipelines in a drop of a hat. And get that, it is better than the former one by more than half a billion! Although not everyone is happy with such decisions, it seems that even Carl Icahn’s complaints won't be able to sway Southwest Gas Holdings’ decision. Though we will have our eyes peeled in any case… If everything goes as planned, a $2 billion deal will be closed before the end of the year.
Kingston Midstream Secures Deal to Acquire Clearwater Assets from Rangeland Midstream Canada
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Rangeland Energy has agreed to sell Rangeland Midstream Canada to Kingston Midstream Alberta and remains committed to future Canadian midstream investments. Texas-based Rangeland Energy, supported by financial partner EnCap Flatrock Midstream, has inked a deal to sell its Canadian subsidiary, Rangeland Midstream Canada Ltd., to Calgary's Kingston Midstream Alberta Ltd. for cash.
Rangeland Energy has agreed to sell Rangeland Midstream Canada to Kingston Midstream Alberta and remains committed to future Canadian midstream investments. Texas-based Rangeland Energy, supported by financial partner EnCap Flatrock Midstream, has inked a deal to sell its Canadian subsidiary, Rangeland Midstream Canada Ltd., to Calgary's Kingston Midstream Alberta Ltd. for cash.
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The merger between ONEOK and Magellan received approval from Magellan shareholders, securing just 55% of the total votes at Magellan’s meeting on Sept. 21. ONEOK Inc. has successfully concluded the acquisition of Magellan Midstream Partners LP on Sept. 25. The deal will bring together their respective assets and expertise, resulting in a powerful entity boasting an extensive network of approximately 25,000 miles of pipelines primarily focused on transporting liquids.
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Viper Energy's deal, comprised of cash and equity, secures an additional 2,800 net royalty acres in the Midland Basin and 1,800 in the Delaware Basin. Viper Energy Partners LP, a Diamondback Energy Inc. subsidiary, has inked a deal to acquire mineral and royalty interests in the Permian Basin. The deal, valued at around $1 billion, is with Warwick Capital Partners and GRP Energy Capital. Viper was established by Diamondback with the purpose of owning, purchasing, and capitalizing on oil and natural gas assets in North America, specifically targeting mineral and royalty interests.