Gateway Energy Corporation announced yesterday that the Company entered into an agreement to acquire natural gas pipeline assets from Laser Pipeline Company, LP for $1.1 million. The expectation is that the acquisition will close on or before October 22, 2010, if certain conditions are met.
Gateway Energy Corporation expects to finance the acquisition through a combination of cash on hand, bank debt and common stock. The form and terms of any such financing is expected to be finalized in the coming weeks.
Mr. Fred Pevow, the President and CEO of Gateway Energy Corporation, commented, “The Laser transaction accomplishes a number of strategic objectives for us as we implement our plan to transform Gateway. First, it is immediately accretive to earnings and cash flow per share. Second, it increases the size and diversification of our asset base with long-term, stable cash flow. Third, we should be able to manage the new assets without a material increase in general and administrative expenses.”
The assets being purchased include four natural gas pipelines that deliver natural gas into poultry processing and rendering plants owned by Tyson Foods, Inc. The Tyson plants reside in Center, Texas, Seguin, Texas, Sedalia, Missouri, and Texarkana, Arkansas. In connection with the acquisition, Gateway Energy Corporation is acquiring exclusive, long-term contracts with Tyson Foods, Inc. to transport natural gas at a fixed tariff rate into each plant.
Gateway Energy Corporation management will hold a conference call and Q&A session on Tuesday, September 28, 2010 at 12:00 PM Eastern to further discuss the acquisition. The dial-in phone number (U.S. toll free) for the conference call is (800) 860-2442. Presentation slides accompanying the information discussed will be available on the Company’s website.
Headquartered in Houston, Texas, Gateway Energy Corporation owns and operates natural gas distribution, transportation, and gathering systems onshore in the continental United States and in federal and state waters of the Gulf of Mexico.
For more information visit: www.gatewayenergy.com
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