Southwestern Energy has agreed to sell its Fayetteville Shale E&P and related midstream gathering assets to Flywheel Energy LLC, backed by Kayne Private Energy Income Funds, for $1.865 billion in cash and assumption of approximately $438 million of future contractual liabilities.
The assets include 915,000 net acres, 3.679 Tcf as of year-end 2017 Proved Reserves, 716 MMcf/d of net production, and associated midstream gathering infrastructure and compression. The midstream assets have gathering volumes of 1.2 Bcf/d as of June 30, 2018, 2,045 miles of gathering pipelines, and 358,830 horsepower of compression. Through the transaction, Flywheel is acquiring a fully-integrated upstream and midstream unit with transportation secured to Gulf Coast demand centers and LNG export facilities through 2030.
Bill Way, President and CEO of Southwestern Energy, said, “We are pleased with the process, the outcome, and the resulting valuation of this significant asset… Our shareholders will benefit from an optimized portfolio, stronger balance sheet including improved financial flexibility, and the return of capital to all shareholders through a share repurchase program.”
Madhurima Deka
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