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ArcLight Completes Acquisition of a 25% Interest in the Gulf Coast Express Pipeline

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ArcLight Capital Partners has successfully acquired a 25% equity interest in Gulf Coast Express Pipeline from Targa Resources for $857 million. The GCX pipeline, with a capacity of 2.02 Bcf/d, is essential for transporting natural gas from the Permian Basin to the Gulf Coast, fueling demand in emerging LNG markets. ArcLight's Managing Director, Lucius Taylor, expressed confidence in GCX’s role in meeting growing global gas demand responsibly as the energy sector transitions. Macquarie Capital served as the financial advisor for this transaction.

Positive
  • Acquisition of a strategic 25% stake in Gulf Coast Express Pipeline for $857 million.
  • GCX pipeline serves a critical role in natural gas transportation and market supply.
  • Established long-term contracts underpinning the pipeline's capacity.
Negative
  • None.

BOSTON, May 17, 2022 /PRNewswire/ -- ArcLight Capital Partners, LLC and affiliates (collectively, "ArcLight") announced today that it has completed the acquisition of a wholly-owned subsidiary of Targa Resources Corp. (NYSE: TRGP) ("Targa") that owns a 25% equity interest in Gulf Coast Express Pipeline ("GCX") for $857 million.

GCX is a premier, natural gas pipeline with 2.02 Bcf/d of capacity that is underpinned by a diverse array of shippers under long-term, committed contracts. GCX is operated by Kinder Morgan Inc. and provides critical residue gas takeaway service from the Permian Basin to key US Gulf Coast end-markets, including key emerging demand regions such as the growing liquefied natural gas ("LNG") export market in South Texas.

"ArcLight is pleased to acquire newly constructed, critical-path midstream infrastructure to assist continued energy transition efforts," said Lucius Taylor, Managing Director at ArcLight. "We strongly believe that, alongside our operating partners, GCX will continue to help supply growing global gas demand by bringing responsibly-sourced Permian Basin natural gas production to key demand markets as we transition to a clean and secure energy future."

Macquarie Capital (USA) Inc. acted as financial advisor and Latham & Watkins LLP acted as legal counsel to ArcLight on the transaction.

About ArcLight

ArcLight is a leading private equity firm focused on energy, infrastructure and energy transition with a successful long-term track record. Founded in 2001, the firm helped pioneer an asset-based approach to investing across the power, renewables, infrastructure and broader energy value chain. Since then, ArcLight has invested approximately $26 billion in 116 transactions, including over $10 billion of equity capital into the electrification segment, which includes power, transmission, renewable infrastructure and energy transition investments. Through its large infrastructure portfolio, ArcLight is focused on providing decarbonizing energy solutions with a strong ESG focus. Based in Boston, the firm's investment team employs a value-added investment approach that benefits from its dedicated in-house technical, operational, and commercial specialists and partners, as well as the firm's approximately 1,500-person asset management affiliate. More information about ArcLight can be found at www.arclight.com.

Cision View original content:https://www.prnewswire.com/news-releases/arclight-completes-acquisition-of-a-25-interest-in-the-gulf-coast-express-pipeline-301549622.html

SOURCE ArcLight Capital Partners

FAQ

What is the significance of ArcLight's acquisition of GCX for TRGP?

This acquisition allows ArcLight to strengthen its position in midstream infrastructure and meet growing natural gas demand.

How much did ArcLight pay for the 25% interest in GCX?

ArcLight completed the acquisition for $857 million.

What is the capacity of the Gulf Coast Express Pipeline?

The GCX pipeline has a capacity of 2.02 Bcf/d.

Who operates the Gulf Coast Express Pipeline?

The GCX is operated by Kinder Morgan Inc.

How does this acquisition impact Targa Resources Corp. (TRGP)?

This transaction could enhance Targa's financial flexibility while allowing ArcLight to leverage the pipeline’s infrastructure.

Targa Resources Corp.

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