ArcLight Acquires 25% Stake in Gulf Coast Express Pipeline for $865 Million
Deal News | Feb 03, 2025 | Arclight
ArcLight Capital Partners has completed the acquisition of a 25% equity interest in Gulf Coast Express Pipeline LLC for $865 million from an affiliate of Phillips 66. The pipeline will now be co-owned by subsidiaries of Kinder Morgan and ArcLight and operated by Kinder Morgan. GCX is a significant natural gas pipeline with a capacity of approximately 2 Bcf/d, connecting the Permian Basin to the US Gulf Coast, primarily serving regions including the LNG export market in South Texas. ArcLight, a major infrastructure investor, emphasizes the growing demand for natural gas infrastructure driven by energy needs related to AI and data centers. This acquisition is positioned to leverage the growth in Permian production and LNG demand. Barclays Capital served as financial advisor and Latham & Watkins as legal counsel to ArcLight.
Sectors
- Energy Infrastructure
- Financial Advisory
- Legal Services
Geography
- United States – The transaction involves the Gulf Coast Express Pipeline operating in the US, with implications for energy supply from the Permian Basin to the US Gulf Coast.
Industry
- Energy Infrastructure – The article discusses ArcLight’s acquisition related to a natural gas pipeline, emphasizing energy infrastructure investments.
- Financial Advisory – Barclays Capital's role as a financial advisor in the transaction highlights the importance of financial services in M&A activities.
- Legal Services – Latham & Watkins provided legal counsel, underscoring the critical role of legal services in structuring and finalizing corporate transactions.
Financials
- $865 million – The purchase price for a 25% equity interest in Gulf Coast Express Pipeline.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| ArcLight Capital Partners, LLC | Bidding Company | Company | A leading infrastructure investor with a proven track record in electrification infrastructure investments. |
| Gulf Coast Express Pipeline LLC | Target Company | Company | A major natural gas pipeline operator connecting the Permian Basin to the US Gulf Coast. |
| Phillips 66 | Selling Company | Company | An affiliate involved in selling a 25% equity interest in GCX Pipeline. |
| Kinder Morgan, Inc. | Other | Company | Joint owner of GCX Pipeline following the transaction, operating the pipeline. |
| Barclays Capital Inc. | Financial Advisor | Company | Provided financial advisory services to ArcLight during the acquisition. |
| Latham & Watkins LLP | Legal Advisor | Company | Served as legal counsel to ArcLight in the transaction. |
| Dan Revers | Representative of ArcLight | Person | Founder of ArcLight, emphasizing the strategic importance of the acquisition. |
| Lucius Taylor | Representative of ArcLight | Person | Partner at ArcLight, commented on the growth opportunities associated with GCX. |