Regency said that it will fund the transaction by issuing approximately 4.7 million class D limited partner units to an affiliate of GE Energy Financial Services and $11.7 million of cash to FrontStreet EnergyOne.
FrontStreet Hugoton owns the Hugoton gas gathering system in Kansas and Oklahoma, which consists of five compressor stations with 55,329HP and 1,700 miles of pipeline extending over nine counties. The Hugoton system is operated by BP America Production, a wholly owned subsidiary of integrated energy giant BP.
James Hunt, chairman and CEO of Regency, said: The Hugoton assets significantly expand our presence in Kansas and complement our existing gathering system in the mid-continent region. This area in southwest Kansas consists of long-lived, mature reserves that have been producing since the 1930s.
