Leading electric and gas utility,
CenterPoint Energy Inc.
(
CNP
) announced that its indirect, wholly owned natural gas gathering,
processing and treating subsidiary CenterPoint Energy Field
Services, LLC, or CEFS, has entered into two agreements to purchase
gathering and processing assets located primarily in northeast
Texas.
The first is an agreement to acquire gathering and processing
assets from Prism Gas Systems I, L.P., a wholly owned subsidiary
of
Martin Midstream Partners L.P.
(
MMLP
), and certain other gathering and processing assets from Martin
Midstream Partners' Natural Gas Services segment for around $275
million, subject to certain adjustments. The assets to be acquired
include Prism's 50% interest in Waskom Gas Processing Company.
In another deal, CEFS has entered into a 15-year agreement with
Encana Oil & Gas Inc., a subsidiary of
Encana Corporation
(
ECA
), to gather and treat its natural gas production from the Amoruso
and Hilltop fields located in Robertson and Leon counties in east
Texas. In connection with entering into the gathering agreement,
which includes volume commitments and acreage dedication, CEFS
bought Encana's 139-mile Amoruso gathering systems for
approximately $89 million.
CenterPoint Energy, with its balanced portfolio of electric and
natural gas businesses, provides a diversified risk profile, along
with stable earnings and cash flow. Once again, quarterly earnings
were saved by the company's broad and diversified portfolio. Its
service territory is spread across six states that protect it from
individual state specific risks.
Going forward, our bullish outlook for the company is supported
by its strong liquidity position, stable regulated operations,
ongoing infrastructure development projects, and a strong balance
sheet.
However, these positives are partially offset by pending
regulatory cases, including the outcome of the Texas rate case, a
tepid economy, lower demand for electricity, declining wholesale
natural gas prices and a significant presence in a hurricane-prone
section of the U.S.
CenterPoint Energy presently retains a short-term Zacks #3 Rank
(Hold) that corresponds with our long-term Neutral recommendation
on the stock.
CENTERPOINT EGY (CNP): Free Stock Analysis
Report
ENCANA CORP (ECA): Free Stock Analysis Report
MARTIN MIDSTRM (MMLP): Free Stock Analysis
Report
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