The consortium comprises of Shinhan Investment, Samtan, EIP Investment, and KDB KIAMCO


Image: South Korean Consortium has acquired 50% interest in Utopia pipeline from Riverstone. Photo: courtesy of outgunned21/FreeImages.

A South Korean-based consortium of infrastructure investors have acquired 50% stake in Utopia pipeline from Riverstone Holdings.

The consortium comprises of Shinhan Investment, Samtan, EIP Investment, and KDB KIAMCO.

The 431km pipeline delivers ethane sourced from the Marcellus and Utica shales in Harrison County, Ohio to the Samica petrochemical market in Ontario in Canada.

Designed to have an initial capacity of 50,000 barrels per day (bpd), the Utopia pipeline can be expanded to over 75,000bpd through the construction of additional pump stations.

The 12inch Utopia pipeline connects with an existing Kinder Morgan pipeline.

EIP Investment president Heejun (June) Park said: “This transaction represents a landmark investment for our funds and we are pleased to be partners with a world-class operator. Since 2017, there have been large inflows of investments in US midstream assets by Korean strategic and institutional investors, and we expect this trend to continue.”

Riverstone formed a joint venture with Kinder Morgan in 2016

In 2016, Riverstone had entered into a joint venture with Kinder Morgan to build the Utopia pipeline.

Kinder Morgan will continue to be the operator of the pipeline and maintain its stake in the joint venture.

Riverstone principal John Jessup said: “Utopia is a unique midstream infrastructure asset that benefits from strong supply-push and demand-pull fundamentals.

“Riverstone is glad to have partnered with Kinder Morgan on this project, the success of which was made possible by their broad capabilities from commercial development to project execution.”

For the transaction, CIBC Capital Markets served as the exclusive financial advisor for the consortium while Lee & Ko and Winston & Strawn acted as legal advisors.

On the other hand, Morgan Stanley & Co. was exclusive financial advisors to Riverstone and Vinson & Elkins was their legal advisors.

Furthermore, the Consortium had entered into a credit agreement with CIBC Capital Markets, ING Capital and Société Générale to provide debt financing to support the deal.