Rice Energy buying Marcellus gathering assets for $110M

Posted February 13, 2014

CANONSBURG – Rice Energy Inc. said Wednesday its Rice Poseidon Midstream subsidiary is acquiring assets in eastern Washington and Greene counties from M3 Midstream’s Appalachia Gathering subsidiary.

The purchase price was $110 million in cash, subject to customary purchase price adjustments

The assets to be acquired consist of a 28-mile, 6”-16” gathering system in eastern Washington County, and permits and rights of way in Washington and Greene counties needed to construct an 18-mile, 30” gathering system connecting the northern system to the Texas Eastern pipeline.

The northern system is supported by long-term contracts with acreage dedications covering approximately 20,000 acres from third parties. Once fully constructed, the acquired systems are expected to have an aggregate capacity of over 1 billion cubic feet per day.

“The M3 Appalachia transaction represents a unique opportunity for Rice that is consistent with our strategic focus of proactively investing in our midstream to facilitate our upstream growth,” said Daniel J. Rice IV, chief executive officer.

The transaction will be effective March 1.

Rice Energy Inc. is an independent natural gas and oil company engaged in the acquisition, exploration and development of natural gas and oil properties in the Appalachian Basin.