DOW JONES NEWSWIRES
Cabot Oil & Gas Corp. (COG) is selling some of its midstream shale assets in the Marcellus Shale in Pennsylvania to Williams Partners LP (WPZ) in a $150 million deal that includes a 25-year gathering agreement.
Williams Partners is the holder of gas-transportation and gathering assets for Williams Cos. (WMB).
The companies said the assets include 75 miles of pipelines and two compressor stations, the sale of which should close before the end of the year.
Under the gathering agreement, Williams's field services company will construct miles of pipelines and trunk lines and build two new compressor stations. Williams will also connect all Cabot drilling program wells with specific gathering lines and move Cabot output to five interstate delivery points during the term of the agreement.
Williams Partners Senior Vice President Alan Armstrong said the additional expansion in the Marcellus Shale was ideal growth for the company.
Cabot's third-quarter profit sank 90% on lower natural-gas prices, reduced oil production and one-time items. It has seen results decline in recent quarters.
Williams Partners's third-quarter profit fell 19% on higher interest costs related to acquisitions from Williams Cos.
None of the companies' shares were active after the news. Cabot stock closed up 3.2% at $34.42 and Williams Partners shares rose 0.7% to $45.81. The former's shares have struggled this year, falling 21%, while the latter's stock has climbed more than the broader market with a 49% increase.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291; email@example.com