DTE Energy has agreed to acquire $1.3bn worth of midstream natural gas assets from M3 Midstream and Vega Energy Partners, strengthening its presence in the Appalachian basin.
The assets considered for acquisition gather natural gas produced in the Appalachia region and provide access to multiple markets.
The acquisition is part of the DTE Energy’s growth plans.
As per the deal, DTE will acquire 100% interest in the Appalachia gathering system (AGS) located in Pennsylvania and West Virginia as well as 40% stake in Stonewall gas gathering (SGG) in West Virginia from M3 Midstream.
The firm has also agreed to acquire 15% stake in the SGG from Vega Energy Partners.
DTE Energy president and COO Jerry Norcia said: "These two systems are complementary to our current asset portfolio and will provide synergies over time."
Upon completion of the deal, the assets will become part of the DTE's non-utility Gas Storage and Pipeline business, which owns natural gas gathering, transmission and storage facilities serving the Midwest, Ontario and Northeast markets.
DTE Energy CEO Gerry Anderson said: "The acquired assets are in a productive area of the Southwest Marcellus/Utica region and have expansion potential.
“These acquisitions align with DTE's existing strengths in managing natural gas midstream assets."
In addition to complementing existing gas midstream business, the assets are expected to provide improved economics supported by long term contracts and high quality reserves.
The transactions are planned to be completed in the fourth quarter of this year.