The system includes the Echo Springs cryogenic processing plant and related natural gas gathering system near Wamsutter. Once an approved definitive agreement is reached, the deal will be subject to standard closing conditions.

The letter of intent provides for Williams Partners to receive cash flows from the existing Wamsutter business and share with Williams the increase in cash flows resulting from growth of the existing business. Williams will retain the right to make, and receive cash flows from, material expansion investments. Williams could then offer such expansion assets to the partnership, but Williams Partners would not be obligated to purchase any such expansion assets.

Alan Armstrong, COO of the general partner of Williams Partners, said: The addition of an interest in the Wamsutter System to our growing portfolio of assets should provide the partnership with additional scale and increased diversity in its cash flows. Once the deal is complete, Williams Partners will own assets serving several stable and high-growth potential basins.

Steve Malcolm, chairman, president and CEO of Williams, said: The transaction demonstrates Williams’s commitment to execute on its value-creation strategy. In addition to providing Williams with access to low-cost capital for Williams to invest in high-growth potential areas such as the Piceance Basin and deepwater Gulf of Mexico, additional dropdown transactions put us into a higher returns position as the general partner of Williams Partners.