augusta free press news

Dominion Energy to sell gas transmission, storage assets to Berkshire Hathaway Energy

Dominion EnergyDominion Energy has executed an agreement to sell its gas transmission and storage segment assets to an affiliate of Berkshire Hathaway Inc. in a transaction valued at $9.7 billion, including the assumption of $5.7 billion of existing indebtedness.

The sale includes more than 7,700 miles of natural gas storage and transmission pipelines and about 900 billion cubic feet of gas storage that the company currently operates to an affiliate of Berkshire Hathaway Energy, which will also make a cash payment of approximately $4 billion to Dominion Energy upon closing.

The announcement, according to Dominion Energy chairman, president and CEO Tom Farrell, reflects Dominion’s focus on its state-regulated, sustainability-focused utilities.

The company expects that up to 90 percent of its future operating earnings will come from its portfolio of best-in-class electric and natural gas state-regulated utility companies centered around five key states: Virginia, the Carolinas, Ohio, and Utah.

“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,” Farrell said.

Assets covered by the sale agreement include the company’s ownership interests in Dominion Energy Transmission, Questar Pipeline (including Overthrust and White River Hub), Carolina Gas Transmission, Iroquois Gas Transmission System (50 percent interest), legacy gathering and processing operations, farmout acreage, as well as a 25 percent operating interest in Cove Point.

These assets will be reclassified as discontinued operations for GAAP reporting and excluded from operating earnings for full-year 2020.

The company’s interest in the Atlantic Coast Pipeline is not included in the transaction.

Dominion Energy plans to invest up to $55 billion over the next 15 years in emissions reduction technologies, including zero-carbon generation and energy storage, gas distribution line replacement, and renewable natural gas, with plans to retire more than four gigawatts of coal- and oil-fired electric generation by 2025, Farrell said.

“This transaction represents another significant step in our evolution as a company, allowing us to focus even more on fulfilling utility customer needs and positioning us for a bright and increasingly sustainable future,” Farrell said.

augusta free press
augusta free press