Dominion Energy, an American electric power and natural gas company, has agreed to sell its stake of 50% in the Cove Point LNG project in Maryland, US to Berkshire Hathaway Energy for $3.3bn.
Cove Point is a liquefied natural gas (LNG) project built on the Chesapeake Bay near Lusby. It has a storage capacity of 14.6 billion cubic feet (BCF) and a send-out capacity of 1.8BCF per day.
Currently, Berkshire Hathaway Energy, through its subsidiary BHE GT&S, operates the LNG terminal and owns a 100% general partner and 25% limited partner interest.
Following the completion of the deal, it will hold a 75% stake in the Cove Point LNG project, while the remaining 25% is held by a subsidiary of Brookfield Infrastructure Partners.
BHE GT&S president Paul Ruppert said: “We are proud of our operations at Cove Point and are excited for this opportunity to increase our ownership in these world-class facilities. The Cove Point team will continue to focus on providing safe, affordable and reliable service to its valued customers.”
Dominion Energy has been reportedly trying to divest its stake in the project since November 2022.
The company said that the total post-tax proceeds of around $3.3bn are anticipated to be utilised for repaying debt. This includes the existing term loan of $2.3bn secured by its non-controlling stake in the Cove Point LNG project.
Dominion Energy chair, president, and CEO Robert Blue said: “Since 2002, Cove Point has been an excellent service provider to its international and domestic customers – linking global gas supplies with American customers, and American gas supplies with customers around the world.
“However, this investment is non-core to Dominion Energy as we focus on our state-regulated utility operations. The sale demonstrates our commitment to the company’s credit profile and represents an attractive exit from what has been an excellent investment for our shareholders.”
The deal, which is subject to customary conditions such as clearance under the Hart-Scott-Rodino Act as well as a filing with the US Department of Energy, is expected to close by the year-end.
