Consol Energy Inc. and Noble Energy Inc. set terms Wednesday for the initial public offering of their midstream master limited partnership, announcing plans to raise about $350 million with 7.5 million units at a price range of $19.00-21.00/unit.
The companies said in June they intended to take Cone Midstream Partners LP public to better serve growing production from their 50/50 joint venture (JV) in the Marcellus Shale (see Shale Daily, June 12). Cone would be managed by both companies.
If the underwriters sell more than 17.5 million common units in the offering, Consol and Noble have granted them a 30-day option to purchase an additional 2.6 million units. A date for Cone’s IPO was not provided in registration documents, which the companies have previously said they expect to complete by the end of the year.
According to a Form S-1 filed with the U.S. Securities and Exchange Commission in August, Cone’s midstream assets cover 496,000 net acres in Ohio, Pennsylvania and West Virginia (see Shale Daily, Aug. 26). They include 127 miles of anchor system pipeline, which accounted for 497 billion Btu/d of average daily throughput in 1H2014; 1,329 billion Btu/d of maximum interconnect capacity and 55,340 horsepower of compression. That is in addition to 27 miles of growth system pipeline and six miles of additional systems.
Consol and Noble’s combined daily gross production in the first six months of 2014 averaged 520 MMcfe/d on their JV acreage, a 100% compound annual growth rate since January 2011.
The move to go public comes at a time when IPOs for midstream MLPs are on the rise as operators look for investments to build out infrastructure and further monetize existing assets, and as investors search for growth potential. Last year, 24 energy-related IPOs raised about $10.9 billion, of which 20 were MLPs with proceeds of $5.2 billion, according to consulting firm PwC (see Daily GPI, Feb. 14).
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