Samchully Asset Management has acquired a 34 per cent interest in Cardinal Gas Services (CGS), located in Ohio’s Utica Shale play, from TOTAL E&P USA and EV Energy Partners, who owned 25 per cent and nine per cent of CGS, respectively.
The total purchase price of USD544 million (USD612 million including purchase price adjustments) is comprised of 100 per cent cash. For purposes of the acquisition, Samchully AMC has established a special purpose vehicle that is owned by a new fund, with investors comprised of Korean pension funds and E1, a Korean strategic investor.
CGS is a wet gas gathering system in the heart of the Utica Shale play in eastern Ohio. The system was established in 2011 and has grown rapidly to support the fast-growing production within the area. CGS is operated by Access Midstream Partners, who will continue to own the remaining 66 per cent of the system, and is backed by 20-year, cost of service contracts.
Following the purchase of a 34 per cent interest in the Neptune Gas Processing Plant in February 2013, this transaction represents Samchully’s second direct investment in the North American midstream sector. Samchully also has four investments in the North American upstream sector.
"We are pleased to announce the acquisition of CGS, which is a continuation of our focus on investing in North American energy infrastructure," says DH Kim, chief investment officer of Samchully AMC. "We are very excited to find an opportunity in the Utica Shale, which we view as one of the premier basins in North America, and we are seeking opportunities to add value, including long-term commodity off-take contracts to the Korean and Asian markets and additional midstream infrastructure in the northeast.”
