Subject to approval from the Maryland Public Service Commission, the transaction is expected to close in the first half of 2020
US-based energy company Chesapeake Utilities has agreed to acquire Elkton Gas from an energy services company, South Jersey Industries (SJI) for an undisclosed amount.
Upon completion of the deal, Elkton Gas, which delivers safe, reliable and affordable natural gas to about 7,000 residential and commercial customers in Cecil County, Maryland, will become a wholly-owned subsidiary of Chesapeake Utilities.
Subject to approval from the Maryland Public Service Commission, the transaction is expected to close in the first half of 2020.
Chesapeake Utilities president and CEO Jeff Householder said: “The acquisition of Elkton Gas is significant in that it jumpstarts our current operation, enabling us to more quickly expand our footprint in Cecil County.
“We are excited about our prospects for natural gas distribution growth in this growing area and are committed to delivering superior service to the customers and communities we serve by: increasing their energy options; growing our systems and infrastructure in order to provide safe and reliable delivery of energy to customers; and providing exceptional customer service.”
Elkton Gas is a long-term customer of Eastern Shore Natural Gas Company
The SJI subsidiary has also been a long-term customer of Eastern Shore Natural Gas Company, an interstate transmission pipeline company that is a wholly-owned subsidiary of Chesapeake Utilities Corporation.
Currently, Chesapeake Utilities is serving another area of Cecil County, Maryland with natural gas service and has been managing its expansion into this area largely from its Delaware operations.
Chesapeake Utilities vice president Shane Breakie said: “Acquiring these operational resources in Cecil County offers close proximity to the I-95 interstate corridor and to our existing Cecil County service territory which will better position us for the commercial, industrial and residential growth opportunities projected for the area.”
Elkton Gas was acquired by SJI along with New Jersey-based Elizabethtown Gas in July last year from a subsidiary of Southern Company Gas, an energy services.