A Buffett-Style Deal

Investing legend purchases Dominion Energy assets

For his first major move in four years, investing magnate Warren Buffett turned to the energy sector, purchasing the gas transmission and power storage assets of Dominion Energy, the Richmond-based utility.

An affiliate of Buffett’s Berkshire-Hathaway conglomerate took on the Dominion sale for approximately $9.7 billion, the companies announced in a press release July 5. “Dominion Energy [today] announced that it has executed a definitive agreement to sell substantially all of its Gas Transmission & Storage segment assets to an affiliate of Berkshire Hathaway Inc., in a transaction valued at $9.7 billion, including the assumption of $5.7 billion of existing indebtedness,” the full statement reads.

Some have gone so far as to say the transaction “solidifies natural gas as the fuel of the future.” That, combined with renewable energy integration, make up a huge part of Dominion’s strategy.

Dominion Energy expects that up to 90 percent of its future operating earnings will come from its portfolio of best-in-class electric and natural gas state-regulated utility companies centered around five key states: Virginia, the Carolinas, Ohio, and Utah. Retained non-state regulated utility operations, most notably a 50 percent passive and unlevered interest in Cove Point — a bidirectional LNG facility in Maryland — and the company’s zero-carbon nuclear and solar contracted generation fleet, represent high-quality, long-term contracted, regulated-like assets with virtually no direct commodity exposure.

The assets include more than 7,700 miles of natural gas storage and transmission pipelines and about 900 billion cubic feet of gas storage that the company currently operates.

No comments yet... Be the first to leave a reply!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

<span>%d</span> bloggers like this: