Kinder Morgan to buy midstream assets from Kohlberg Kravis Roberts

Kinder Morgan Energy Partners (KMP) has agreed to acquire a 50% stake in midstream developments held by investment firm Kohlberg Kravis Roberts & Co. (KKR).

In accordance with the deal, KKR will acquire the Altamont gathering, processing and treating assets in the Uintah Basin in the US state of Utah, as well as the Camino Real Gathering System in the Eagle Ford Shale in Texas, for $300m in KMP shares.

The acquisition will give Kinder Morgan complete control over KKR’s assets, in which El Paso Corporation holds a 50% stake.

Duane Kokinda, Kinder Morgan Intrastate Pipelines president, said: "We are pleased to reach this agreement with KKR which, upon closure of both transactions noted above, will increase Kinder Morgan’s ownership in this joint venture to 100%: 50% at KMP and 50% at KMI."

KKR global head of energy and infrastructure Marc Lipschultz said: "We are pleased to transfer our 50% interest in the partnership to Kinder Morgan, a world class midstream operator that will continue to invest in these important assets."

The deal will expand Kinder Morgan’s oil and natural gas gathering capabilities, including the Camino Real Gathering System with 150 MMcf/d of gas gathering capacity and 110,000 bpd of oil gathering capacity.

The deal will close after the completion of Kinder Morgan’s acquisition of El Paso, scheduled for the end of May 2012.