U.S. power utility DTE Energy Co today announced it has entered into an agreement to acquire gas pipeline system M5 Midstream LLC for about $2.5 billion, expanding its business that’s not tied to the providing of electricity, according to a news release.
As Reuters reports, advanced energy efficiency measures have made the provision of electricity less lucrative for power companies like DTE, which serves about 2.2 million customers in southeastern Michigan, including Detroit, and is a factor in the company’s acquisition.
DTE has sought to expand its businesses that encompass natural gas pipelines and storage because they provide steady cash flows even during energy price swings. DTE also has an energy marketing and trading business.
M5 Midstream, which operates in the Haynesville shale formation spanning Louisiana and parts of East Texas, was developed by Momentum Midstream LLC and is the second Momentum company purchased by DTE in the past five years. DTE acquired gas pipeline assets in Pennsylvania and West Virginia called M3 Midstream LLC.
M5’s pipelines transport gas from Haynesville Shale to larger pipes that then take it to end-users and export terminals.
