Spectra Energy, which separated from Duke Energy and became a stand-alone, publicly traded company earlier this year, on Friday announced that its midstream master limited partnership (MLP), Spectra Energy Partners LP, plans to spin off as an initial public offering (IPO). The time for the spin-off was not disclosed.

The new stand-alone MLP initially would own and operate two interstate natural gas pipeline systems: East Tennessee Pipeline System, with a 100% stake, and the Gulfstream Pipeline System, with a 24.5% stake. It also would own and operate a 50% interest in the Market Hub Partners system in Acadia Parish, LA, and Moss Bluff, TX (see Daily GPI, Dec. 7, 2006). The partnership also would own and operate the Kingsport, TN, liquefied natural gas storage facility, which has the capacity to store about 1 Bcf .

The new company, to be traded on the New York Stock Exchange under the symbol “SEP,” would be owned by a subsidiary of Spectra Energy, which would become the general partner of the MLP. Through its subsidiaries, Spectra Energy would own 82% of the MLP through the general partner and limited partner ownership interest. Martha Wyrsch, who is now president and CEO of Spectra Energy Transmission, has been named chair of the new venture. Greg Harper has been tapped to serve as the MLP’s president and CEO, and Lon Mitchell has been named vice president and CFO.

Citigroup Global Markets Inc. and Lehman Brothers Inc. will act as lead book-running managers for the offering.

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