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Williams, Western Gas Complete Swap of Permian, Appalachian Assets

Williams Partners LP has completed a deal that boosts its ownership interest in two Marcellus Shale natural gas gathering systems in northern Pennsylvania with a combined throughput of 1.6 Bcf/d.

Western Gas Partners LP, the midstream master limited partnership of Anadarko Petroleum Corp.,  exchanged its non-operated  33.75% stake in the Rome and Liberty gathering systems for Williams' 50% non-operated stake in Delaware Basin JV Gathering LLC (DBJV). Western Gas Partners also paid Williams $155 million in cash to take full ownership of the West Texas gathering system.

Williams now has a 67.5% interest in Rome and Liberty. The company was already operating those systems, which are part of its largest Marcellus gathering franchise, the Bradford Supply Hub. A Williams spokesman said Statoil ASA and Mitsui & Co. Ltd. affiliates own the rest of the Rome and Liberty systems.

Rome and Liberty consist of 531 miles of pipeline across several Pennsylvania counties, while the DBJV consists of 577 miles of pipeline that serve Anadarko and third party producers in Loving, Ward, Winkler and Reeves counties, TX.

Williams also received $45 million from Anadarko and Energy Transfer Partners LP (ETP) for its 33.33% stake in the Ranch Westex processing plant. Anadarko and ETP each paid $22.5 million to split  Williams' interest in the facility and grow their respective interests to 50%. The Delaware Basin plant processes natural gas delivered from the Bone Spring and Avalon shales. It has a processing capacity of 125 MMcf/d.

Anadarko exited the Marcellus with a $1.24 billion sale last December. The producer has been concentrating its operations on the Permian Basin, the Denver-Julesburg Basin and the deepwater Gulf of Mexico. Western Gas still has assets in the Marcellus' northern tier.

For Williams, the deal to boost its ownership interests in the Marcellus coincides with a its recent focus to streamline operations and reduce its footprint to gas-rich regions such as the Appalachian Basin. The company plans to maintain its presence in the Delaware, which is part of  its strategy.

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