Stabilis Energy has signed a definitive agreement to purchase all of the US based assets of Encana Natural Gas (ENGI).
ENGI is a leading distributor of LNG fuel to domestic high horsepower engines in the oilfield, mining, rail, marine and road transportation, and industrial sectors. The transaction is scheduled to close on 30 April 2014. Terms of the transaction were not disclosed.
Stabilis Energy CEO, Casey Crenshaw, commented: "We are proud to announce the addition of Encana Natural Gas Inc.'s people, assets, and customer relationships to Stabilis Energy. ENGI has a world-class staff that will help us reach our goal of being the leading provider of LNG fuel solutions to high horsepower operators in North America. They possess deep sector expertise and strong customer relationships that we believe will make Stabilis Energy an LNG industry leader across multiple geographies and end markets."
In addition to adding ENGI's staff, Stabilis has agreed to purchase its fleet of cryogenic rolling stock assets including storage and regasification trailers, mobile fuelling units, and other related equipment. Stabilis will fufill all of ENGI's existing customer obligations including its existing contracts, subject to customer consent.
Crenshaw added: "Stabilis is excited about growing the LNG market in partnership with ENGI's market leading customers."
LNG fuel solutions
Jim Reddinger, Stabilis COO, commented: "Encana Natural Gas Inc.'s customers should expect business as usual - with the same great people, great equipment, and great customer service. But they also will benefit from the expanded scope and scale of the new Stabilis Energy business. Our fully integrated LNG fuel solutions offering - spanning from LNG production to delivery and on-site technical service - will give our customers the confidence they need to choose LNG to fuel their mission critical high horsepower engine activities."
Stabilis plans to open its first LNG production facility in George West, Texas in January 2015 to service oilfield customers in the Eagle Ford shale. The facility is being built as part of a previously announced venture with Flint Hills Resources, to build up to five LNG production facilities that target oilfield customers.
The George West facility is currently under construction and will be able to produce approximately 100 000 LNG gal./d when complete. Other targeted LNG liquefaction plant locations include West Texas, North Dakota, and other major oilfield regions. Stabilis will continue to source fuel from ENGI's large existing third-party supply network.
Natural gas future
Encana Corporation executive VP, David Hill, commented: "Encana is pleased that Stabilis Energy will carry on the outstanding LNG business that our Natural Gas team has worked hard to build over the past several years. Encana believes that natural gas has a bright future as a domestic fuel source for high horsepower engines and that LNG will be an important part of this value chain."
On completion of the transaction, Stabilis Energy will operate one of the largest cryogenic rolling stock fleets in North America across 20 states and multiple end markets. Senior management teams from both companies will assume leadership positions with Stabilis Energy.
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/small-scale-lng/18042014/stabilis_energy_to_buy_encana_lng_assets_03/