Overview

Macquarie Infrastructure Partners II Completes Acquisition of Leaf River Energy Center LLC

03 December 2012

  • High performance salt cavern storage facility located in Smith County, Mississippi permitted for four caverns and 32 Bcf of total working gas capacity 
  • Uniquely positioned to capture Southeast and Northeast demand; ideally situated with access to multiple interstate pipelines 
  • Demand for salt cavern storage capacity in the Southeast driven by gas-fired power generation 
  • The facility’s current capacity is fully contracted with strong credit counterparties 

NEW YORK — Macquarie Infrastructure Partners II ("MIP II"), a leading North American infrastructure fund, announced today that it has completed the acquisition of Leaf River Energy Center LLC (“Leaf River”) from NGS Energy, LP. 

Leaf River is a state-of-the-art underground salt cavern facility located in Smith County, Mississippi. The Leaf River complex currently consists of two commercially operational caverns with a third cavern under development. The facility is currently permitted for four caverns and 32 Bcf of total working gas capacity. 

“We are excited to announce MIP II’s first acquisition in the midstream energy space,” said Christopher Leslie, Chief Executive Officer of Macquarie Infrastructure Partners Inc. “The increase in supply from shale gas production and the projected growth in natural gas demand have created a significant need for midstream infrastructure buildout across the U.S. Salt cavern facilities in particular make for attractive investment opportunities given their ability to provide customers with high performance gas storage as more power plants use natural gas.” 

Leaf River is strategically located with access to Southeast and Northeast demand centers via direct interconnections with six interstate pipelines including the Transco, Destin, Tennessee, Midcontinent Express, Gulf South and Southern Natural pipelines. Leaf River is also closely situated to key supply areas such as the Haynesville and Bossier shales. As a result, Leaf River is well positioned to serve both summer-peaking gas-fired power generation loads in the Southeast and winter-peaking residential and commercial demand in the Northeast and Mid-Atlantic markets.

The MIP II manager is part of the Macquarie Group, which globally has invested in a number of midstream assets, including the Dampier Bunbury Pipeline, Pisto SAS and TanQuid. 

Terms of the transaction were not disclosed. 

MIP II was advised in this transaction by Macquarie Capital, Sidley Austin LLP, Adams and Reese LLP, Pace Global, a Siemens Business and Black & Veatch Management Consulting. 

About Macquarie Infrastructure Partners 
Macquarie Infrastructure Partners Inc. is a member of the Macquarie Group of companies and manages the unlisted Macquarie Infrastructure Partners (MIP) and Macquarie Infrastructure Partners II (MIP II) funds. MIP and MIP II have combined equity under management of over $5.5 billion committed to infrastructure investments in North America. MIP and MIP II have ownership interests in a diversified portfolio of businesses, including waste services, toll roads, bridges, utilities, ports, and telecommunications infrastructure. 

About Macquarie Group 
Macquarie Group (Macquarie) is a global provider of banking, financial, advisory, investment and funds management services. Macquarie’s main business focus is making returns by providing a diversified range of services to clients. Macquarie acts on behalf of institutional, corporate and retail clients and counterparties around the world. Founded in 1969, Macquarie operates in more than 70 office locations in 28 countries. Macquarie employs approximately 13,400 people and has assets under management of over $353 billion (as of September 30, 2012). 

Contacts: 
Paula Chirhart 
Corporate Communications, Macquarie Group 
Tel: +1 212 231 1239