Williams Partners teamed with Caiman Energy for a newly established $800 million Utica Shale midstream energy venture backed by EnCap Flatrock Midstream and Highstar Capital.
Williams Partners, a master limited partnership (MLP) owned by publicly traded natural gas stalwart The Williams Companies, will contribute $380 million to the Utica Shale project, according to a Williams press statement. EnCap and Highstar did not reveal their investment in the joint venture.
The Williams-Caiman company has a unique “area of focus,” noted Tulsa, Oklahoma-headquartered Williams in its statement, citing its concentration in “natural gas liquid and oil rich” Ohio and northwest Pennsylvania. Exploration of Utica Shale is concentrated in Ohio.
Conveniently, Williams Partners recently opened a midstream business focused on West Virginia, Pennsylvania and Ohio that Williams said will support the joint venture. Shale is sedimentary rock that can produce gas.
EnCap Flatrock is a four-year-old offshoot of Texas private equity firm EnCap Investments. EnCap Flatrock held a first close on its second fund, which has a $1.25 billion target, in May. New York-headquartered Highstar is a private equity concern specialised in energy infrastructure.
In March, Williams Partners paid $2.5 billion for Eastern Midstream, a former Caiman Energy operation.