CorEnergy sells interstate natural gas pipeline system to Spire Midstream from $175 million
(UI) – CorEnergy Infrastructure Trust, Inc. closed the sale of its MoGas and Omega pipeline systems to Spire Midstream, a subsidiary of Spire Inc. The MoGas System is an interstate natural gas transmission and distribution system provides service to markets in Missouri and Illinois.
The all-cash transaction is worth $175 million plus working capital adjustments, resulting in net proceeds of approximately $165 million after taxes and transaction-related costs.
Dave Schulte, Chairman and Chief Executive Officer of CorEnergy, said, “We want to thank our dedicated MoGas and Omega associates, who will continue supporting Spire to provide safe transportation of critical supplies of natural gas to customers in Missouri. These companies were the last remaining legacy operations from our predecessor corporation and were included in our groundbreaking qualification for REIT status.”
President and CFO Robert Waldron added, “As previously communicated, we plan to undertake corporate cost reductions commensurate with our smaller operating footprint and may take charges for those activities. Major oil production companies have recently announced major write-downs of their reserves in the state of California resulting from government policies reducing the economic value of their production. These same regulations have adversely affected volumes transported on our pipelines, and therefore, their economic life. We are evaluating the Crimson business for possible write-downs related to shorter useful lives of pipeline assets, and will provide an update in due course.”
CorEnergy Infrastructure Trust, Inc. is a real estate investment trust that owns and operates regulated crude oil pipelines and associated rights-of-way.
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