Peoples Natural Gas looks to purchase Equitable Gas
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PITTSBURGH – Peoples Natural Gas said Thursday it has an agreement with EQT Corp. to purchase EQT’s Equitable Gas Co., its distribution business in Pennsylvania, West Virginia and Kentucky.
Peoples said in a news release EQT will receive $720 million in cash and select midstream assets and commercial arrangements that will strengthen its midstream operations.
The deal is subject to approval by various regulatory bodies, including the Pennsylvania Public Utility Commission, West Virginia Public Service Commission and Kentucky Public Service Commission, as well as the Federal Energy Regulatory Commission and federal antitrust authorities. The transaction is expected to close in the second half of 2013.
Morgan O’Brien, president and chief executive officer of Peoples, said the addition of Equitable Gas to its local distribution system will greatly benefit the Western Pennsylvania community, and beyond, by creating significant operational efficiencies.
Peoples and its Peoples TWP subsidiary in Butler currently have 420,000 customers in 18 Western Pennsylvania counties. Spokesman Barry Kukovich said it has 5,044 customers in Washington County and another 522 in Greene County.
If the deal is approved, it would acquire 14,500 Equitable csutomers in Washington County and and another 4,910 in Greene County.
Peoples said it is committed to increased capital spending on the pipeline systems.
It said the combination with Equitable would result in a more streamlined and efficient operating system for customers, allowing the companies to avoid a substantial amount of upcoming replacement costs where the systems overlap.
Peoples also said it expects the transaction to promote greater competition in gas supply, since the combined systems are expected to attract more marketers and permit them to operate more efficiently.
In addition, Peoples said it will continue its support of local gas producers.
“The natural gas industry is quickly evolving into the cleanest and most economical solution for meeting this country’s future energy needs,” O’Brien said, “and Western Pennsylvania is at the heart of this economic boom.”