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Parent To Sell Utility With Significant Gas Choice Program, Migration For $4.3 Billion
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Dominion Energy today announced that it has executed three separate definitive agreements to sell its three natural gas distribution companies, including The East Ohio Gas Company (Dominion East Ohio), to Enbridge
The three LDCs -- The East Ohio Gas Company, Public Service Company of North Carolina, Incorporated, and Questar Gas Company along with Wexpro Company -- serve about 3 million homes and businesses in Ohio, North Carolina, Utah, Wyoming, and Idaho, and collectively comprise approximately 78,000 miles of natural gas distribution, transmission, gathering, and storage pipelines; more than 62 Bcf of working underground and liquefied natural gas storage capacity; and approximately 400 Bcfe of cost-of-service regulated gas reserves as of year-end 2022.
Dominion said that the aggregate transactions value is $14.0 billion, including the assumption of $4.6 billion of debt, which Dominion said represents approximately 1.5x estimated 2022 year-end rate base of $9.2 billion.
Dominion said that the aggregate purchase price is $9.4 billion, which Dominion said represents approximately 16.6x estimated 2023 operating earnings of $564 million and approximately 16.7x estimated 2024 operating earnings of $561 million.
Dominion said that total estimated after-tax proceeds are $8.7 billion, which are expected to be used to reduce parent debt in addition to the conveyance of $4.6 billion of operating company debt.
The purchase price for The East Ohio Gas Company is specifically $4.3 billion
The East Ohio Gas Company, also known as Dominion East Ohio, serves more than 1.2 million customers across more than 400 communities and 27 counties in Ohio.
The transactions require clearance under the Hart-Scott-Rodino Act, approval from the Federal Communications Commission, approval from the Committee on Foreign Investment in the United States as well as review or approval from Idaho Public Utilities Commission, North Carolina Utilities Commission, Public Utilities Commission of Ohio, Utah Public Service Commission, and Wyoming Public Service Commission. Closing of each transaction is expected to occur following receipt of each respective state regulatory approval(s), as required, and are not cross conditioned upon each other, Dominion said
Enbridge said that the transaction creates North America's largest natural gas utility platform delivering ~9.3 bcf/d to ~7 million customers across multiple regulatory jurisdictions.
Among other businesses, Enbridge operates a local distribution utility in Ontario with retail gas choice
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September 5, 2023
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Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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