Spectra Energy has signed an agreement with EQT Corporation to acquire the Big Sandy Pipeline system in eastern Kentucky, US, for approximately $390m.
The Federal Energy Regulatory Commission-regulated natural gas pipeline system is about 70 miles in length and has 171 million cubic feet per day of capacity.
EQT will be the main shipper on the pipeline, with over 80% of the pipeline’s capacity under firm, 16-year transportation agreements.
The pipeline’s interconnect with the Tennessee Gas Pipeline system links the Huron Shale and Appalachian Basin natural gas supplies to the Mid-Atlantic and Northeast markets.
Spectra Energy president and CEO Gregory Rizzo said that Big Sandy Pipeline strengthens Spectra’s portfolio of fee-based natural gas assets and is consistent with the company’s strategy of growth through third-party acquisitions.
The transaction is expected to close during the third quarter of this year, subject to Hart-Scott-Rodino approval and other closing conditions.