Warren Equity Partners and Multifuels LP in midstream tie-up

The US buyout firm brought $20 million in cash and equity commitments to help found the partnership while Multifuels LP contributed an existing gas pipeline.

Mid-market private equity firm Warren Equity Partners has joined up with Multifuels LP to form the Multifuels Midstream Group (MMG) in Houston, Texas. 

Warren brought $20 million in cash and equity commitments to help found the partnership and Multifuels LP contributed an existing natural gas pipeline that provides service to an unnamed Texas utility service area.

The group will focus on owning, operating and developing midstream projects in North America, with an emphasis on lateral distribution pipelines that will transport natural gas from main lines to end users. These will include utilities and petrochemical plants, according to a Multifuels statement. MMG will seek assets with long-term offtaker agreements in place which offer isolation from commodity market price swings.

“The company will execute on an existing portfolio of development projects which capitalises on the US trend toward increased utilisation of natural gas in power plants, petrochemical plants and industrial complexes; growth in the number of residential households accessing natural gas through local distribution companies; and increased export opportunities through LNG facilities,” said the statement, which emphasised a desire to execute long-term contracts with “strong, creditworthy counterparties”.

At the helm as MMG's inaugural chief executive is Randy Gibbs, who founded Multifuels LP in 1997, with former Enron vice president Jim Ducote as well as LP vice presidents Dick Robinson and Gil Muhl rounding out the leadership team. 

Warren Equity Partners is a North America-focused investment firm based in Florida which targets equity investments of between $5 million and $40 million. The firm seeks opportunities in the electrical infrastructure, water infrastructure, building services, and midstream oil and gas infrastructure and services sectors.