Williams, Canada Pension Plan form joint venture partnership
Natural gas infrastructure provider Williams has partnered with the Canada Pension Plan Investment Board (CPPIB) to support ongoing growth and Northeast region optimization in the western Marcellus and Utica basins.
The agreement establishes a $3.8 billion joint venture that will include Williams’ 100 percent owned Ohio Valley Midstream (OVM) system and 100 percent of Utica East Ohio Midstream system (UEO). CPPIB will invest approximately $1.34 billion for a 35 percent ownership stake in the joint venture.
“Acquiring the remaining interest in UEO and forming a partnership with CPPIB continues to advance our already strong position in the Northeast,” Alan Armstrong, president and chief executive officer of Williams, said. “These transactions create a platform for continued optimization and growth, provide deleveraging, reduce capital spending on processing and fractionation capacity for OVM and unlock further synergies through combined operatorship of the systems.”
Williams expects synergies through common ownership by combining UEO and OVM to create a more efficient platform for capital spending in the region, resulting in reduced operating and maintenance expenses and creating enhanced capabilities and benefits for producers in the area.
“We’ve seen first-hand the focus of the UEO employees on delivering safe, environmentally compliant and reliable results, and we are excited to welcome these employees to Williams,” Micheal Dunn, chief operating officer of Williams, said. “Williams looks forward to helping Encino and CPPIB maximize their important investment in the basin through safe, reliable and cost-efficient services.”
