$230M Blacks Fork/Emigrant Trail deal closes

GREEN RIVER – A pair of natural-gas processing facilities in southwest Wyoming picked up new partial owners last week in a $230 million transaction that closed out a deal inked in May.

The sale essentially drops down 40 percent of ownership of Green River Processing – including the three-plant Blacks Fork processing complex and the Emigrant Trail processing plant – from QEP Resources Inc. to new subsidiary QEP Midstream Partners LP.

“It’s basically a mechanism of growth for QEPM,´ said spokesman Brent Rockwood in a recent phone interview. “And it allows QEP to really monetize the assets.”

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With the majority owner unchanged after the transaction, it will be “work as usual” for the plants’ employees. The transaction occurred on schedule with the deal going through July 1 as previously expected.

QEP Midstream owns, operates, acquires and develops midstream energy assets, according to its website, and went through an initial public offering in August 2013. This transaction will be the company’s first acquisition since the IPO. Rockwood called the sale a “dropdown” that continues to carve midstream assets out of the QEP umbrella.

The Blacks Fork complex contains three processing plants with up to 505 million cubic feet per day of cryogenic processing capacity and a 330 million cubic feet per day Joule-Thomson processing plant. In addition, the complex has 15,000 barrel per day of fractionation capacity and associated truck and rail loading facilities, which allow Green River Processing to sell products into local and regional natural gas liquids markets. The majority of gas processed at the Blacks Forks complex is produced in the Pinedale Anticline which is approximately 100 miles north of the complex.

The Emigrant Trail processing plant, located approximately ten miles south of the Blacks Fork complex, consists of one cryogenic gas processing train with inlet capacity of approximately 55 million cubic feet per day. The plant receives the majority of its gas from various gas fields along the Moxa Arch, including Church Buttes, located in the Green River Basin of western Wyoming. The inlets of the Emigrant Trail plant and the Blacks Fork Complex are interconnected allowing raw gas to be processed at either or both facilities.