Phillips 66 announced a definitive agreement to sell DCP GCX Pipeline LLC, which holds a 25% non-operated equity interest in Gulf Coast Express Pipeline LLC, to an affiliate of ArcLight Capital Partners, LLC. The transaction is for pre-tax total cash proceeds of $865 million, subject to purchase price adjustments.
This sale enables Phillips 66 to exceed its $3 billion asset divestiture target, initially established as part of its strategic priorities. The company stated its intention to continue optimizing its portfolio and rationalizing non-core assets going forward.
The Gulf Coast Express Pipeline is an approximately 500-mile system that transports about 2 billion cubic feet per day of natural gas from the Permian Basin to the Agua Dulce, Texas area. The sale, expected to close in January 2025, represents an implied Enterprise Value/EBITDA multiple of 10.6x based on expected 2025 EBITDA, with proceeds supporting shareholder returns and debt reduction.
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