Duke Energy Reaches Purchase Agreement with Union Pacific Resources
Duke Energy Field Services Inc. has reached an agreement to purchase the natural gas gathering, processing, fractionation and natural gas liquids (NGL) pipeline business of Union Pacific Resources (UPFuels) as well as UPR's natural gas and NGL marketing activities.
This acquisition, which is valued at $1.35 billion, increases the number of processing facilities that Duke Energy currently owns or has partial interest in from 41 to 60. It also increases its number of processing plants that the company operates from 30 to 47. This acquisition adds 2.3 billion cubic feet per day (Bcf/d) of processing capacity to the existing 4.6 Bcf/d of capacity for a total of 6.9 Bcf/d of capacity. It also expands Duke Energy's fractionation capacity by 118,000 barrels per day (Bbl/d) for a combined total of 200,000 Bbl/d. Additionally, it adds 7,200 miles of pipeline to Duke Energy's existing 19,800 miles of pipe for a total of 27,000 miles of pipeline.
Jim Mogg, president and chief executive officer of Duke Energy Field Services said, "These are quality assets that both complement our existing assets as well as expand our asset base into new geographic areas with anticipated growth."
According to the agreement, much of UPR's U.S. production will be gathered and processed by Duke Energy for a minimum of 10 years. UPR also will dedicate for five years most of its natural gas and NGL production to Duke Energy for marketing. The transaction is expected to close at the end of the first quarter of 1999.
Duke Energy Field Services is also working on several other projects, including: the purchase of several natural gas gathering systems and processing plants from ONEOK Inc.; plans to build a natural gas processing plant with ONEOK (Oklahoma); and the purchase of the Roberts Ranch natural gas processing plant in Midland County (Texas).
Duke Energy Field Services Inc. gathers and processes natural gas and markets of natural gas liquids. The company also provides intrastate natural gas transportation and storage, and financial services for producers.