GE expands energy footprint with Eagle Ford pipeline investment

General Electric will buy a 30.6 percent stake in San Antonio-based Howard Energy Partners, GE announced this week,  the mega-corporation’s latest move to grow its energy footprint.

GE didn’t disclose the cost of its deal with the pipeline company, which plans to use the investment to buy Meritage Midstream Services’ natural gas gathering assets in South Texas. Howard Energy Partners currently operates 280 miles of natural gas pipelines in the Eagle Ford Shale.

The deal is slated to close in April, but it is subject to regulator approval.

“The shale boom has created the need for a dramatic build out of oil and gas infrastructure in North America, requiring significant capital,” said John Shepherd, a managing director at GE Energy Financial Services. “This fits perfectly with our strategy of working with expert management teams to meet rapidly growing producer demand for infrastructure. It plays to our strengths of flexibility in transaction structuring to meet our partners’ needs, our access to large amounts of capital and GE’s broad and deep shale expertise.”

GE Chief Executive Officer Jeffrey Immelt told the Houston Chronicle last week that the company is focused on growing its Texas presence to expand its role in the energy industry.

The Howard Energy investment adds to GE Energy Financial Services’ 43,500 miles of gas pipelines in North America. In total, the company has nearly $3 billion invested in pipelines and other midstream assets, according to the release.

Howard Energy will nearly double its size with the Meritage acquisition, which adds 185 miles of pipelines, including the Eagle Ford Escondido Gathering System and the Cuervo Creek Gathering system, according to the GE announcement.

In addition to GE, other investors in Howard energy assets include Crosstex Energy, Quanta Services and Clear Springs energy Company.