Daily News: February 8, 2019

Wells Fargo Advises Sempra Energy on Natural Gas Storage Sale


Wells Fargo Securities served as financial advisor to Sempra Energy on the sale of its non-utility U.S. natural gas storage facilities to an affiliate of ArcLight Capital Partners for $328 million in cash.

ArcLight’s affiliate Enstor Gas will operate the facilities going forward.

“With the sale of these assets, we can reallocate capital toward growing our core electric and natural gas infrastructure businesses,” said Joseph A. Householder, president and chief operating officer of Sempra Energy. “We are focused on expanding our leadership position in the most attractive markets as we strive to become North America’s premier energy infrastructure company.”

The non-utility natural gas storage assets included in the sale are the Mississippi Hub storage facility in Simpson County, with a working capacity of 22.3 billion cubic feet (Bcf) of natural gas, and the Bay Gas storage facility in Southwest Alabama, which comprises five underground caverns with a working capacity of 20.4 Bcf of natural gas. The sale also included Sempra Energy’s approximate 91% stake in Bay Gas.

Immediately prior to the sale, Sempra Energy’s subsidiary acquired some of the Bay Gas interest from a minority owner and included it in the sale to ArcLight. ArcLight owns now 100% of Mississippi Hub and Bay Gas.

Sempra Energy’s legal advisor on the transaction was Jones Day.

Founded in 2001, ArcLight is a private equity firm focused on energy infrastructure investments.

Based in San Diego, Sempra Energy is an electric and natural gas infrastructure company and the utility holding company with the largest U.S. customer base. It employs approximately 20,000 staff members who serve more than 40 million consumers worldwide.