VALLEY FORGE, Pa.--(BUSINESS WIRE)--
UGI Corporation (NYSE: UGI), today announced that it has entered into
agreements with Tenaska Resources, LLC, a natural gas exploration and
production affiliate of independent energy company Tenaska, to jointly
develop gas resources in the Marcellus Shale region in north-central
Pennsylvania. UGI Energy Services, Inc. will construct and operate
approximately 20 miles of new gathering pipelines and related gas
processing and compression facilities for wells that Tenaska intends to
drill in Potter County, Pa., with the first phase of construction
targeted for late 2013 or early 2014. The initial investment in the
proposed gas gathering system is estimated to be up to $25 million, with
the total investment in gathering for full development of Tenaska’s
Potter County acreage estimated to be in the range of $65 million over
ten years. In addition to the gathering opportunity, UGI announced that
it has invested $25 million for an approximate 19% non-operating working
interest in acreage that Tenaska operates near Mainesburg in Tioga
County, Pa. Both projects are located in proximity to UGI’s midstream
and distribution assets, including 14.7 billion cubic feet (Bcf) of
natural gas storage.
Tom A. Boyd, vice president and general manager of Tenaska Resources,
said, “UGI has a specialized working knowledge of the regional natural
gas market and expertise in midstream infrastructure. This strategic
relationship will add value to Tenaska’s producing wells and prospects.”
John L. Walsh, president and chief operating officer of UGI, said, “We
have a long working relationship with Tenaska, a strong company with a
proven track record of success in developing energy projects. We look
forward to our expanded relationship with Tenaska in the development of
natural gas resources within the Marcellus Shale, and our midstream team
remains active and focused on identifying and executing additional
midstream investment opportunities like this one.”
Lon R. Greenberg, chairman and chief executive officer of UGI, added,
“We are pleased to announce another tangible example of the execution of
our strategy to build a midstream business within our existing footprint
in the Marcellus Shale. The opportunities we are announcing today, along
with our previously-announced Auburn II gathering project, leverage both
UGI’s significant asset base and deep knowledge of local and regional
gas markets while demonstrating UGI’s commitment to investing in
infrastructure that will provide consumers with increased access to
abundant, regionally-produced natural gas.”
About UGI
UGI is a distributor and marketer of energy products and services.
Through subsidiaries, UGI operates natural gas and electric utilities in
Pennsylvania, distributes propane both domestically and internationally,
manages midstream energy and electric generation assets in Pennsylvania,
and engages in energy marketing in the Mid-Atlantic region. UGI, through
subsidiaries, is the sole General Partner and owns 26% of AmeriGas
Partners, L.P. (NYSE:APU), the nation's largest retail propane
distributor. Comprehensive information about UGI Corporation is
available on the Internet at http://www.ugicorp.com.
About UGI Energy Services, Inc.
UGI Energy Services, Inc. owns 14.7 BCF of underground natural gas
storage in north-central Pennsylvania, operates LNG and propane/air
peaking plants in Pennsylvania, and is developing midstream projects
throughout the Marcellus Shale region. UGI Energy Services also markets
natural gas, electricity and liquid fuels to approximately 18,000
commercial and industrial customers at approximately 43,000 locations in
nine eastern states and Washington, D.C. and owns electric generation
assets in Pennsylvania.
About Tenaska Resources, LLC
Tenaska Resources, LLC is the natural gas exploration and production
affiliate of Omaha, Neb.-based energy company Tenaska, one of the
leading independent power producers in the U.S. Tenaska Resources
manages drilling and production targeting natural gas reserves in the
Marcellus Shale geologic formation beneath most of Pennsylvania and West
Virginia.
Tenaska and its affiliates manage approximately 11,000 megawatts (MW) of
power generation consisting of 14 power plants, seven of which are owned
in partnership with other companies, and have developed approximately
9,000 MW of natural gas-fueled and renewable power plants. Tenaska
affiliates also market natural gas, electric power and biofuels, with
the natural gas marketing affiliate regarded as one of the top 10
natural gas marketers in North America. Tenaska affiliates are also
involved in private equity investment and acquisition management, fuel
supply, natural gas transportation systems and electric transmission
development. Forbes magazine ranks Tenaska 35th among the largest
privately-held U.S. companies, based on 2011 revenues. To learn more
about Tenaska, visit the company’s Website at www.tenaska.com.
This press release contains certain forward-looking statements that
management of UGI believes to be reasonable as of today’s date only.
Actual results may differ significantly because of risks and
uncertainties that are difficult to predict and many of which are beyond
management’s control. You should read UGI’s Annual Report on Form 10-K
for a more extensive list of factors that could affect results. Among
them are adverse weather conditions, cost volatility and availability of
all energy products, including propane, natural gas, electricity and
fuel oil, increased customer conservation measures, the impact of
pending and future legal proceedings, domestic and international
political, regulatory and economic conditions including currency
exchange rate fluctuations (particularly the euro), the timing of
development of Marcellus Shale gas production, the timing and success of
our commercial initiatives and investments to grow our business, and our
ability to successfully integrate acquired businesses, and achieve
anticipated synergies. UGI undertakes no obligation to release revisions
to its forward-looking statements to reflect events or circumstances
occurring after today.
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Source: UGI Corporation and Tenaska Resources, LLC