Midcoast Energy Resources is buying two short pipeline systemsfrom Koch Gateway to serve new demand for marketing andtransportation in the Baton Rouge, LA, area. The systems will beacquired by Midcoast’s wholly owned subsidiaries, Mid Louisiana GasCo. (MLG) and Mid Louisiana Gas Transmission Co. (MLGT) for $2.6million cash. Midcoast will assume operations June 1, with closinganticipated during the third quarter, subject to approval by theFederal Energy Regulatory Commission and appropriate Louisianaagencies.

The systems are about 10 miles of six- to 12-inch pipeline nearBaton Rouge, LA, and are being acquired as part of Midcoast’sdevelopment of a high-pressure pipeline to serve new and existingcustomers in and around the Baton Rouge area. The expansion willhelp meet demand from new contracts to provide 65 MMcf/day ofmarketing services and 20 MMcf/day of transportation services to anindustrial facility near Port Hudson, LA, and a new cogenerationfacility near Baton Rouge.

“This acquisition and our earlier announced purchase of aseparate pipeline from Amoco Production Co. are part of ourexpansion efforts in Louisiana,” said Midcoast President Dan C.Tutcher. “These acquisitions will allow Midcoast to serve the newtransportation and marketing customers recently added to MLG andMLGT in a timely and less environmentally intrusive manner, whilealso providing capacity for future growth in the area.”

Houston-based Midcoast has offices in Alabama, Louisiana andMississippi. The company transports, gathers, processes and marketsgas and other petroleum products through more than 50 company-ownedpipelines covering about 1,500 miles in nine states.

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