ArcLight deal to create midstream concern

$10bn ArcLight Capital Partners and CenterPoint Energy have jointly created a MLP. The new partnership is expected to be publicly listed.

Fund manager ArcLight Capital Partners has announced a joint venture to create a multibillion dollar midstream energy company in a press release.

Enogex, a midstream energy concern jointly owned by ArcLight and OGE Energy Corporation,  will be merged with the pipeline and field service business of CenterPoint Energy.

The newly created operation will result in a master limited partnership (MLP) co-managed by OGE and CenterPoint.

Robb Turner, ArcLight senior managing partner, said the partnership is positioned to capitalise on the “infrastructure build out” for shipping oil and natural gas.

CenterPoint is a ‘Fortune 500’ electricity and natural gas provider in Houston prominent in the US South, while OGE, short for Oklahoma Gas and Electric, is the parent company of Enogex.

Both CenterPoint and OGE are publicly traded. The newly created MLP will go public, according to the press release.

The transaction is expected to close in the second or third quarter of this year. ArcLight, a $10 billion investment company, will own 13 percent of the MLP.

The partnership will result in a combined 8,400-mile pipeline network operating in Arkansas, Louisiana, Oklahoma and Texas.