Bloomgberg is reporting that NextEra Partners, LP, will "buy seven Texas gas pipelines for $2.1 billion." When the deal was announced, shares in the partnership fell the most they had fallen in over a year.
“They’ll be selling a lot of equity to finance this acquisition,” Kit Konolige, senior utility analyst at Bloomberg Intelligence, who doesn’t own or rate NextEra or its partnership, said Monday in an e-mail. “Current NextEra partnership shareholders may be concerned about their stake being diluted.”
NextEra Energy Partners fell 10 percent to $31.94 at 10:26 a.m. in New York, the most since June, 2014. NextEra rose 3.2 percent to $108.57.But this is what caught my eye, and I'm sure caught the eye(s) of everyone who read the story:
The purchase marks the first foray into pipelines for NextEra Energy Partners, which was formed in 2014. Before Monday’s transaction, the partnership had focused on buying renewable-energy power assets from its creator.Back to the lede:
NextEra Energy Partners LP, the wind and solar power generator controlled by NextEra Energy Inc., agreed to buy seven natural gas pipelines in Texas for $2.1 billion, adding sales of the power plant fuel to Mexico.So, this company, formed in 2014 -- that was, like, last year? The company lasts one year before it diversifies into fossil fuel. I guess they need natural gas to support their hobby industry if government tax credits don't come through.
By buying closely held NET Midstream, NextEra Energy Partners will gain the ability to ship 3 billion cubic feet of Texas shale gas a day, with the potential to expand that by 1 billion cubic feet. NET’s assets include a pipeline in the Eagle Ford formation, the top U.S. gas field by proved reserves.