HOUSTON — Kinder Morgan Energy Partners will acquire the natural gas company Copano Energy LLC for about $3.2 billion in stock, giving the energy transportation and storage company more access to oil and gas-rich territory in Texas, Wyoming and Oklahoma.
Including the assumption of debt, the deal is valued at around $5 billion.
The announcement came one day after Shell US Gas & Power LLC and Southern Liquefaction Co. LLC, a Kinder Morgan company and unit of El Paso Pipeline Partners, announced plans to develop a natural gas liquefaction plant at Southern LNG’s Elba Island Terminal on the Savannah River.
Construction on the liquefaction plant is expected to start in the next few years, with the first exports flowing out by the end of the decade.
Subject to various corporate and regulatory approvals, Shell and Kinder Morgan affiliates have agreed to modify the Elba Express Pipeline and Elba Island LNG Terminal to physically transport natural gas to the terminal, liquefy it and load it onto ships for export.
Copano Energy largely serves natural gas producers, doing work in gathering, processing, treating and natural gas liquids fractionation.
“We will be able to pursue incremental development in the Eagle Ford Shale play in south Texas, gain entry into the Barnett Shale Combo in north Texas and the Mississippi Lime and Woodford Shales in Oklahoma,” Kinder Morgan Energy Chairman and CEO Richard Kinder said Tuesday.
Kinder Morgan Energy will pay $40.91 per Copano unit, a 24 percent premium to the company’s Tuesday closing price of $33.13. Copano has about 90.9 million outstanding shares, according to FactSet.
Once the buyout closes, Kinder Morgan Energy Partners LP will own The Eagle Ford Gathering, which is currently a joint venture between the company and Copano. The Eagle Ford Gathering provides gathering, transportation and processing services to natural gas producers in the Eagle Ford Shale. It includes about 400 miles of pipelines.
Kinder said that the company expects to employ most of Copano’s approximately 415 workers.
The acquisition will likely add modestly to Kinder Morgan Energy’s earnings this year and add about 10 cents per unit for at least the next five years starting in 2014.
The boards of both companies have approved the deal, which is expected to close in the third quarter if approved by regulators and Copano’s investors.
Both companies are based in Houston.