Between the existing SemGroup facilities and those acquired from Meritage, the SemCAMS Midstream JV will own about 900 MMcf/d of natural gas processing capacity in the Montney. (Source: SemGroup Corp./Shutterstock.com)
SemGroup Corp. (NYSE: SEMG) expanded its footprint in Canada’s Montney shale play last week through an acquisition made by a new joint venture (JV) between the Tulsa, Okla.-based company and global investment firm KKR & Co. Inc. (NYSE: KKR).
The JV, SemCAMS Midstream ULC, will combine assets of SemGroup’s Canadian subsidiary and Meritage Midstream ULC, which SemCAMS Midstream agreed to acquire on Jan. 10 for C$600 million (US$449 million) concurrent with the formation of the JV.
Pro-forma for the acquisition, SemCAMS Midstream will have roughly $1.3 billion of assets in Alberta, analysts with Capital One Securities said in a Jan. 10 research note adding that the JV may also serve as a potential IPO platform in 12 to 36 months, depending on market conditions.