Southern Company, Kinder Morgan Finalize Southern Natural Gas Pipeline Strategic Venture
September 01 2016 - 4:15PM
Business Wire
Companies share ownership of existing pipeline
system, plan to explore future infrastructure development
opportunities
Southern Company (NYSE:SO) and Kinder Morgan, Inc. (NYSE:KMI)
today announced the closing of their natural gas pipeline venture
through Southern Company’s acquisition of a 50 percent equity
interest in the Southern Natural Gas (SNG) pipeline system through
a subsidiary of Southern Company Gas. As previously announced,
Kinder Morgan will continue to operate the system and the companies
are pursuing specific growth opportunities to develop additional
natural gas infrastructure for the strategic venture.
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Southern Company, one of the nation’s largest natural gas
consumers and distributors, and Kinder Morgan, a recognized leader
in natural gas pipeline development and operations, will work
together to advance both companies’ efforts to develop
infrastructure important to America’s energy future.
“This strategic venture aligns with Southern Company’s
previously discussed infrastructure development strategy and builds
on Southern Company Gas’ midstream pipeline experience,” said
Southern Company Chairman, President and CEO Thomas A. Fanning.
“With our new ownership stake in Southern Natural Gas we look
forward to working with Kinder Morgan to explore future
opportunities to deliver natural gas to customers.”
SNG is an approximately 7,000-mile pipeline system connecting
natural gas supply basins in Texas, Louisiana, Mississippi and
Alabama to markets in Louisiana, Mississippi, Alabama, Florida,
Georgia, South Carolina and Tennessee. SNG is a principal
transporter of natural gas to Alabama, Georgia and South Carolina,
which are part of one of the fastest-growing natural gas demand
regions in the United States.
“The Southern Company system has been a valued customer of SNG
for many years and this joint venture is expected to greatly
benefit the shareholders of both companies,” said Norman G. Holmes,
president of Kinder Morgan South Region Pipelines. “We are very
pleased to begin pursuing the growth opportunities this strategic
relationship should provide.”
As previously disclosed, Kinder Morgan plans to use all of the
proceeds from this transaction to reduce debt at Kinder Morgan.
Jones Day, Gibson Dunn & Crutcher LLP, Troutman Sanders LLP
and Balch & Bingham LLP are serving as legal counsel to
Southern Company, and Bracewell LLP and Weil, Gotshal & Manges
LLP are serving as legal counsel to Kinder Morgan.
About Kinder Morgan
Kinder Morgan, Inc. (NYSE: KMI) is the largest energy
infrastructure company in North America. It owns an interest in or
operates approximately 84,000 miles of pipelines and
approximately 180 terminals. The company’s pipelines transport
natural gas, gasoline, crude oil, CO2 and other products, and its
terminals store petroleum products and chemicals, and handle bulk
materials like coal and petroleum coke. For more information please
visit www.kindermorgan.com.
About Southern Company
Southern Company (NYSE: SO) is America's premier energy company,
with 44,000 megawatts of generating capacity and 1,500 billion
cubic feet of combined natural gas consumption and throughput
volume serving 9 million electric and gas utility customers through
its subsidiaries. The company provides clean, safe, reliable and
affordable energy through electric utilities in four states,
natural gas distribution utilities in seven states, a competitive
generation company serving wholesale customers across America and a
nationally recognized provider of customized energy solutions, as
well as fiber optics and wireless communications. Southern Company
brands are known for excellent customer service, high reliability
and affordable prices that are below the national average. Through
an industry-leading commitment to innovation, Southern Company and
its subsidiaries are inventing America's energy future by
developing the full portfolio of energy resources, including
carbon-free nuclear, 21st century coal, natural gas, renewables and
energy efficiency, and creating new products and services for the
benefit of customers. Southern Company has been named by the U.S.
Department of Defense and G.I. Jobs magazine as a top military
employer, recognized among the Top 50 Companies for Diversity by
DiversityInc, listed by Black Enterprise magazine as one of the 40
Best Companies for Diversity and designated a Top Employer for
Hispanics by Hispanic Network. The company has earned a National
Award of Nuclear Science and History from the National Atomic
Museum Foundation for its leadership and commitment to nuclear
development and is continually ranked among the top utilities in
Fortune's annual World's Most Admired Electric and Gas Utility
rankings. Visit our website at www.southerncompany.com.
Cautionary Statements Regarding Forward-Looking
Information
This release contains forward-looking statements which are made
pursuant to safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
include statements, among other things, concerning the expected
benefits of the transaction, including future growth opportunities.
These forward-looking statements are often characterized by the use
of words such as “expect,” “anticipate,” “plan,” “believe,” “may,”
“should,” “will,” “could,” “continue”, “opportunity” and the
negative or plural of these words and other comparable terminology.
Although Southern Company and Kinder Morgan believe that the
expectations reflected in such forward-looking statements are
reasonable, such statements involve risks and uncertainties and
undue reliance should not be placed on such statements. Certain
material factors or assumptions are applied in making
forward-looking statements. Actual results may differ materially
from those expressed or implied in such statements. Important
factors that could cause actual results to differ materially from
these expectations include, among other things, the following: the
possibility that the anticipated benefits from the transaction
cannot be fully realized or may take longer to realize than
expected; the diversion of management time on transaction-related
issues; the impact of legislative, regulatory and competitive
changes; and other risk factors relating to the energy industry, as
detailed from time to time in each of Southern Company’s and Kinder
Morgan’s reports filed with the Securities and Exchange
Commission.
Additional information about these factors and about the
material factors or assumptions underlying such forward-looking
statements may be found under Item 1.A. in Southern Company’s and
Kinder Morgan’s Annual Reports on Form 10-K for the fiscal year
ended December 31, 2015 and Southern Company’s Quarterly Report on
Form 10-Q for the quarter ended June 30, 2016. The foregoing list
of important factors that may affect future results is not
exhaustive. When relying on forward-looking statements to make
decisions, investors and others should carefully consider the
foregoing factors and other uncertainties and potential events. All
subsequent written and oral forward-looking statements concerning
the transaction or other matters attributable to Southern Company,
Kinder Morgan or any other person acting on their behalf are
expressly qualified in their entirety by the cautionary statements
referenced above. The forward-looking statements contained herein
speak only as of the date of this release. Neither Southern Company
nor Kinder Morgan undertakes any obligation to update or revise any
forward-looking statement, except as may be required by law.
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Kinder MorganMedia
RelationsDave Conover,
713-369-9407Dave_conover@kindermorgan.comorInvestor
Relations713-369-9490km_ir@kindermorgan.comwww.kindermorgan.comorSouthern
CompanyMedia Relations404-506-5333 or
866-506-5333www.southerncompany.comorInvestor RelationsAaron
Abramovitz, 404-506-0780apabramo@southernco.com
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