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New acquisition adds 110,000 horsepower
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The majority of the horsepower is under a five-year contract
operations services agreement
HOUSTON--(BUSINESS WIRE)--Jul. 14, 2014--
Exterran Partners, L.P. (NASDAQ:EXLP) and Exterran Holdings, Inc.
(NYSE:EXH) today announced that Exterran Partners has entered into an
agreement to acquire natural gas compression assets from MidCon
Compression, L.L.C., a subsidiary of Chesapeake Energy Corporation
(NYSE:CHK), for approximately $135 million. The assets to be acquired
include 162 compression units, with a total horsepower of approximately
110,000.
The majority of the units currently are being used to provide
compression services to BHP Billiton Petroleum in Arkansas’ Fayetteville
Shale. In connection with the acquisition, the contract operations
services agreement with BHP Billiton Petroleum will be assigned to
Exterran Partners effective as of the closing.
“We are pleased to acquire an additional fleet of modern, highly
standardized assets from MidCon and continue to deliver on our strategy
of growing our core contract operations business,” said Brad Childers,
Chairman, President and Chief Executive Officer of Exterran Partners’
managing general partner.
“We expect the transaction to be immediately accretive to distributable
cash flow per limited partner unit,” said David Miller, Senior Vice
President and Chief Financial Officer of Exterran Partners’ managing
general partner. “As a result of this acquisition, we expect to
recommend to the Board of Exterran Partners’ managing general partner
that Exterran Partners increase the distribution to limited partner unit
holders by an incremental $0.02 per limited partner unit on an
annualized basis, or an incremental $0.005 per limited partner unit on a
quarterly basis, beginning in the quarter that the transaction closes.”
Exterran Partners and Exterran Holdings do not expect that the Omnibus
Agreement between Exterran Partners and Exterran Holdings will be
amended to adjust the caps on operating costs or selling, general and
administrative costs as a result of this transaction.
The acquisition, which is expected to be financed using credit available
under Exterran Partners’ revolving credit facility, is subject to
closing conditions and is expected to close in the third quarter 2014.
About Exterran Partners
Exterran Partners, L.P., a master limited partnership, is the leading
provider of natural gas contract compression services to customers
throughout the United States. Exterran Holdings, Inc. owns an equity
interest in Exterran Partners, including all of the general partner
interest. For more information, visit www.exterran.com.
About Exterran Holdings
Exterran Holdings, Inc. is a global market leader in full service
natural gas compression and a premier provider of operations,
maintenance, service and equipment for oil and gas production,
processing and transportation applications. Exterran Holdings serves
customers across the energy spectrum—from producers to transporters to
processors to storage owners. Headquartered in Houston, Texas, Exterran
has approximately 10,000 employees and operates in approximately 30
countries. Exterran Holdings owns an equity interest, including all of
the general partner interest, in Exterran Partners.
Forward-Looking Statements
All statements in this release (and oral statements made regarding the
subjects of this release) other than historical facts are
forward-looking statements within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements rely on a number of assumptions concerning future events and
are subject to a number of uncertainties and factors, many of which are
outside the control of Exterran Holdings and Exterran Partners (the
“Companies”), which could cause actual results to differ materially from
such statements. Forward-looking information includes, but is not
limited to: the Companies’ financial and operational strategies and
ability to successfully effect those strategies; demand for the
Companies’ products and services and growth opportunities for those
products and services; statements regarding Exterran Partners’ ability
to complete the proposed transaction and the expected timing of the
closing of the transaction; Exterran Partners’ expected use of
availability under its revolving credit facility to finance the
transaction; statements relating to the contract operations services
agreement with BHP Billiton Petroleum; the expectation not to amend the
Omnibus Agreement between the Companies to adjust the caps on operating
costs or selling, general and administrative costs as a result of the
transaction; and the expected benefits of the transaction, including the
expected accretion to distributable cash flow per limited partner unit
and the expected increase in limited partner distributions in the
quarter that the transaction closes.
While the Companies believe that the assumptions concerning future
events are reasonable, they caution that there are inherent difficulties
in predicting certain important factors that could impact the future
performance or results of their business. Among the factors that could
cause results to differ materially from those indicated by such
forward-looking statements are: changes in the capital and financial
markets that impact the effect of the transaction on Exterran Partners;
local, regional, national and international economic conditions and the
impact they may have on the Companies and their customers; changes in
tax laws that impact master limited partnerships; conditions in the oil
and gas industry, including a sustained decrease in the level of supply
or demand for oil or natural gas or a sustained decrease in the price of
oil or natural gas; Exterran Holdings’ ability to timely and
cost-effectively execute larger projects; changes in economic conditions
in key operating markets; changes in safety, health, environmental and
other regulations; as to each of the Companies, the performance of the
other entity; and the failure of any party to the transaction to satisfy
the conditions to the closing of the transaction.
These forward-looking statements are also affected by the risk factors,
forward-looking statements and challenges and uncertainties described in
Exterran Holdings’ Annual Report on Form 10-K for the year ended
December 31, 2013 and its Quarterly Report on Form 10-Q for the quarter
ended March 31, 2014, and Exterran Partners’ Annual Report on Form 10-K
for the year ended December 31, 2013 and its Quarterly Report on Form
10-Q for the quarter ended March 31, 2014, as well as those set forth
from time to time in the Companies’ filings with the Securities and
Exchange Commission, which are currently available at www.exterran.com.
Except as required by law, the Companies expressly disclaim any
intention or obligation to revise or update any forward-looking
statements whether as a result of new information, future events or
otherwise.
Source: Exterran Partners, L.P. and Exterran Holdings, Inc.
Exterran Partners, L.P. and Exterran Holdings, Inc.
Media
Susan
Moore, 281-836-7398
or
Investors
David Oatman,
281-836-7035
David Miller, 281-836-7895