MPLX LP Announces Major Asset Sale to Streamline Operations

MPLX LP's Strategic Asset Divestiture

MPLX LP has made a significant move in its business strategy by entering into a definitive agreement to divest its Rockies gathering and processing assets. This important transaction will see the company sell its assets to a subsidiary of Harvest Midstream for a cash consideration of $1 billion, a decision influenced by the desire to sharpen its focus on core operations.

Details of the Divestiture

Under the terms of the agreement, Harvest Midstream is set to dedicate approximately 12,000 barrels of natural gas liquids (NGLs) per day sourced from these assets back to MPLX for a duration of seven years. This commitment begins after the expiration of a current commitment, showcasing a collaborative outlook even post-sale.

Included in this strategic package are essential natural gas gathering and transportation pipelines along with processing capacity amounting to 1.2 billion cubic feet per day. As of the last financial year, these operations have been functioning at approximately 52%, indicating areas for potential improvement.

The Strategic Vision Behind the Sale

Maryann Mannen, the president and CEO of MPLX, stated that evaluating their portfolio's competitive positioning is a strategic commitment. She emphasized that the divestiture places the company in a stronger position for growth, particularly focusing on more profitable areas such as the Marcellus and Permian basins.

The Implications for MPLX

This divestiture not only simplifies MPLX's operational focus but also aligns with their long-term strategic goals. By shedding non-core assets, they can bolster their investments in regions that promise higher returns. As the energy market evolves, such strategic moves will be crucial for maintaining competitiveness.

Projected Timeline and Closing Conditions

The transaction is expected to close in the fourth quarter of the forthcoming year, contingent on satisfying customary closing conditions. This includes obtaining necessary regulatory approvals under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, ensuring that the sale meets all legal requirements.

About MPLX LP

MPLX LP stands out as a large-cap master limited partnership, widely recognized for its diversified portfolio in midstream energy infrastructure. Its operations consist of a network of crude oil and refined product pipelines, inland marine business segments, and storage and terminal facilities. Additionally, the company owns significant natural gas gathering systems, pipelines, and processing facilities across crucial U.S. supply basins. As a critical player in the energy landscape, MPLX aims to deliver efficient logistics and fuel distribution services.

Contact Information

For inquiries, MPLX's investor relations can be reached at (419) 421-2071. Key contacts include Kristina Kazarian, Vice President Finance; Brian Worthington, Senior Director; and Isaac Feeney, Director of Investor Relations. Communication-related queries can be directed to Jamal Kheiry, Communications Manager, at the same number.

Frequently Asked Questions

What assets is MPLX divesting?

MPLX is divesting its Rockies gathering and processing assets, a strategic move aimed at streamlining operations.

What is the sale price of the assets?

The assets are being sold for a cash consideration of $1 billion.

Why is MPLX making this divestiture?

The divestiture is part of MPLX's strategic commitment to enhance its growth potential, focusing on core areas like the Marcellus and Permian basins.

When is the expected closing date for the transaction?

The transaction is projected to close in the fourth quarter of the upcoming year, pending regulatory approvals.

Who can I contact for more information?

For inquiries, you can contact MPLX's investor relations at (419) 421-2071, and they are available to provide assistance.

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