(Source: Datamonitor)
Crosstex Energy has entered into a definitive agreement to sell its assets in Mississippi, Alabama and South Texas for $220 million to Southcross Energy, a natural gas transportation and processing company.
Proceeds from the sale will be used to pay down more than $200 million of the partnership's outstanding debt, which will satisfy the targets for debt reductions in September 2009 and December 2009 established in the partnership's recent amendments to its debt facilities.
The partnership expects the sale to close on July 31, 2009. Closing is contingent on the approval of the lenders under the partnership's revolving credit and senior note agreements and certain other conditions.
The Mississippi and Alabama systems consist of approximately 780 miles of intrastate gathering and transmission pipelines with throughput capacity of about 185,000 million British thermal units per day (mmbtu/d).
The South Texas system consists of approximately 1,400 miles of intrastate gathering and transmission pipelines with throughput capacity of about 600,000mmbtu/d and two processing facilities with a total processing capacity of approximately 195,000mmbtu/d. These three systems generated gross margin of $12 million and operating expenses of $4 million for the first quarter of 2009.
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