Dominion Energy to sell gas transmission and storage business to Berkshire Hathaway

Dominion Energy has agreed to offload almost all of its gas transmission and storage segment assets to Berkshire Hathaway Energy, an affiliate of Berkshire Hathaway, in a deal worth $9.7 billion, which includes the assumption of $5.7 billion of debt.

The sale of the natural gas transmission and storage business is for establishing itself as a pure-play state-regulated utility, said Dominion Energy.

The assets included in the deal are natural gas transmission lines spanning more than 7,700 miles, with nearly 20.8 billion cubic feet per day of transportation capacity, and operated natural gas storage of 900 billion cubic feet, with 364 billion cubic feet of company-owned working storage capacity, and part ownership of a liquefied natural gas export, import, and storage facility.

Thomas F. Farrell, II – Dominion Energy chairman, president, and CEO said: “Today’s announcement further reflects Dominion Energy’s focus on its premier state-regulated, sustainability-focused utilities that operate in some of the most attractive regions in the country.

“Over the past several years the company has taken a series of steps – including mergers with Questar Corporation and SCANA Corporation, and the divestiture of Blue Racer Midstream and merchant generation assets – to increase materially the state-regulated nature of our profile, enhance the customer experience, strengthen our balance sheet, and improve transparency and predictability.

“Our mission over that period has remained the same: providing round-the-clock affordable and sustainable energy, world-class customer service, and meaningful community engagement.”

Dominion Energy to sell gas transmission and storage business to Berkshire Hathaway. Photo courtesy of Matthew Rakola/Dominion Energy.

As part of the transaction, Berkshire Hathaway Energy will acquire 100% of Dominion Energy Transmission, Questar Pipeline, and Carolina Gas Transmission, and 50% stake in the Iroquois Gas Transmission System. The agreement excludes the acquisition of the Atlantic Coast Pipeline.

In addition to that, Berkshire Hathaway Energy will acquire a 25% stake in Cove Point LNG terminal in Maryland.

Dominion Energy will continue to hold a 50% stake in the Cove Point LNG terminal, with Brookfield Asset Management continuing to hold on to the remaining stake of 25%.

Berkshire Hathaway Energy will be the operator of the Cove Point LNG facility after the closing of the deal.

Bill Fehrman – Berkshire Hathaway Energy president and CEO said: “This premier natural gas transmission and storage business has been operated and managed in a best-in-class manner.

“Acquiring this portfolio of natural gas assets considerably expands our company’s footprint in several Eastern and Western states as well as globally, increasing the market reach and diversity of Berkshire Hathaway Energy.”

Subject to regulatory approvals, the deal is likely to be closed in Q4 2020.