Dominion Energy sells Questar Pipelines to Southwest Gas for nearly $2B
Dominion Energy is selling Questar Pipelines to Southwest Gas Holdings for $1.975 billion.
Questar Pipelines is a Rocky Mountain energy hub with 2,160-miles of highly contracted, FERC-regulated interstate natural gas pipelines providing transportation and underground storage services in Utah, Wyoming and Colorado. Along with it, Southwest Gas acquired its subsidiaries and certain associated affiliates, including Overthrust Pipeline, White River Hub and Questar Field.
“This transaction represents another significant step in our evolution as a company, allowing us to focus even more on fulfilling the energy needs of our utility customers and continuing growth of our clean-energy portfolio, including development of the largest offshore wind farm in North America,” Robert Blue, Dominion Energy chair, president and CEO, said.
Under the terms of the transaction, Southwest Gas Holdings will acquire 100 percent of Questar Pipelines for $1.545 billion in cash and assume $430 million of Questar Pipelines’ debt.
“The acquisition of Questar Pipelines is a milestone moment for the Company that we believe will provide significant financial and strategic benefits to our company, shareholders, employees and partners, as we continue to significantly increase our role in the transitioning energy landscape,” John Hester, Southwest Gas Holdings’ president and CEO, said. “Further, Questar Pipelines’ exceptional re-contracting record, its high-quality, long-standing customer base and our shared culture of safety, makes it an attractive addition to our regulated business platform. This acquisition accelerates our energy transition strategy by strengthening our ability to provide affordable, low carbon energy to customers while positioning us to transport renewable natural gas, responsibly sourced gas, and eventually, hydrogen and CO2.”
The transaction is expected to close in the fourth quarter of 2021, subject to approvals.
Proceeds from the sale will be used by Dominion Energy to reduce debt, including retiring the 364-day term loan that was entered into in July, which Dominion Energy previously used to repay the approximately $1.3 billion transaction deposit made by Berkshire Hathaway Energy. Proceeds will also be used to support Dominion Energy’s capital plan.
Dominion Energy, based in Richmond, Va., serves more than 7 million customers in 16 states. Southwest Gas Holdings delivers natural gas to over 2 million customers in Arizona, California, and Nevada.
