Arkansas regulators have approved Black Hills Corp.'s acquisition of SourceGas Holding LLC's natural gas utility in South Dakota as part of $1.89 billion, four-state deal announced last summer.
The Arkansas Public Service Commission (PSC) last Friday approved the deal, becoming the first state commission to do so. Black Hills is still awaiting decisions from state regulators in Colorado, Nebraska and Wyoming before it is completed, Investor Relations Director Jerome Nichols told NGI.
Black Hills and SourceGas filed with regulators in the four states last August for the South Dakota holding company to assume ownership of SourceGas utilities that collectively represent 425,000 gas utility customers (see Daily GPI, July 13, 2015). The deal includes a 512-mile intrastate gas transmission pipeline in Colorado.
Black Hills COO Linn Evans called the Arkansas PSC approval a "significant milestone" that reaffirms the company’s contention that the SourceGas additions will benefit both existing customers and Black Hills shareholders. "As Arkansas is a new region for [us], we look forward to serving and developing new relationships with these customers.”
Over the last decade, Black Hills has integrated 19 electric and natural gas systems in support of its growth strategy. SourceGas also adds an opportunity to expand its program of providing gas reserves for ratepayers from its exploration and production segment (see Daily GPI, Oct. 5, 2015).
The transaction, expected to be completed by the end of March, would give Black Hills nearly 800,000 gas and electric utility customers in eight states -- Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming.