Targa acquires NGLS, citing weak pricing
OREANDA-NEWS. Citing weakness in commodity prices, Targa Resources announced it will acquire its midstream partnership, Targa Resources Partners, to bolster its credit and improve cash flow.
"This transaction is attractive for Targa's stakeholders, with better positioning in lower commodity price environments and enhanced growth in price recovery scenarios," said chief executive Joe Bob Perkins.
Targa reported it realized NGL sales of 31?/USG in the third quarter versus 75?/USG in the third quarter of 2014.
Gross NGL production rose by 125,800 b/d this year versus last to 283,400 b/d in the third quarter. However, export volumes reportedly fell from 205,900 b/d last year to 184,000 b/d during the quarter, possibly due to narrower arbitrage opportunities during the period.
Targa executives said the company expects to export at least 166,000 b/d of LPG in 2016.
Targa reported total revenues of $1.632bn for the third quarter of 2015 compared with $2.288bn for the third quarter of 2014. Net income was also lower than the third quarter of 2014, at $53.3mn for the third quarter 2015 compared with $138.2mn last year.
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