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Singapore’s GIC and BlackRock to purchase UK gas pipeline company

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Private equity firm Antin Infrastructure Partners has agreed to sell Kellas Midstream to Singapore’s sovereign wealth fund GIC and BlackRock’s Global Energy and Power Infrastructure Funds (GEPIF).

UK pipeline company Kellas Midstream owns and operates key gas infrastructure in the UK central and southern North Sea.

The company’s assets include: the Central Area Transmission System (CATS), a major gas transportation and processing system that takes gas from the central North Sea to the CATS reception and processing terminal at Teesside in the northeast of England; the Esmond Transportation System (ETS), a key subsea pipeline in the southern North Sea connecting four producing fields to the Bacton gas terminal on the North Sea coast; and the Humber Gathering System (HGS), a greenfield project to build the infrastructure required for the development of the large Tolmount gas field in the southern North Sea.

“We are proud of the significant growth and strategic transformation accomplished during Antin’s ownership over the past five years,” commented Mark Crosbie, managing partner at Antin. “We are also grateful for the strong partnership and outstanding performance of Kellas Midstream’s talented management team and dedicated employees. We wish them continued success with their new owners.”

Andy Hessell, managing director at Kellas Midstream, added: “We thank Antin for their significant support over the past five years. GIC and the BlackRock GEPIF team recognise the growth potential of the business we have built and share our strategy to continue to invest, grow and build our portfolio of midstream assets and serve all our customers in the North Sea. We look forward to working with our new partners.”

Commenting on the acquisition, Mark Florian, group head of the GEPIF team at BlackRock, said: “A growing number of institutional investors are seeking exposure to energy and power investments. Within the sector, energy from gas is viewed as a necessary component of the energy transition as we move towards a lower carbon economy. This investment in Kellas Midstream reflects the focus of GEPIF III on making strong equity investments in mid-market energy and power infrastructure and partnering with outstanding management teams.”

Ang Eng Seng, chief investment officer of infrastructure at GIC, added: “We are pleased to invest in Kellas, a leading provider of high-quality midstream infrastructure with a strong track record. As a long-term investor, we look forward to partnering with BlackRock and Kellas’ management to support the future growth of the company.”

The transaction is expected to close in early 2020.