WASHINGTON (dpa-AFX) - EQT Corp. (EQT) and EQT Midstream Partners, LP (EQM) announced that EQT Midstream Partners has agreed to acquire EQT Corporation's wholly owned subsidiary, Sunrise Pipeline, LLC, for $507.5 million cash and $32.5 million of common and general partners units.
The company said that EQT Midstream Partners also agreed to pay additional consideration of $110 million to EQT upon the effectiveness of a new transportation agreement with a third-party that the Partnership expects to become effective post-closing.
In addition, the Partnership announced a $0.40 cash distribution per unit for the second quarter 2013, which represents a $0.03 or 8% increase over the first quarter 2013 cash distribution per unit.
The company noted that Sunrise also entered into a precedent agreement with a third-party, over a 20-year term, for firm transportation capacity related to the Jefferson expansion. The precedent agreement is for approximately 252 BBtu per day of firm transportation capacity from November 1 through March 31 of each year and 62 BBtu per day of firm transportation capacity from April 1 through October 31 of each year. The agreement is expected to commence April 1, 2014, and result in $13.0 million of annual firm reservation revenue and up to $1.0 million of annual firm usage revenue.
EQT said that if a transportation agreement becomes effective under the terms of the precedent agreement by December 31, 2014, the Partnership will make a payment of $110 million to EQT as additional consideration.
Also, the Partnership announced a quarterly cash distribution of $0.40 per unit for the second quarter of 2013, payable on August 14, 2013 to all unitholders of record at the close of business on August 5, 2013.
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