Locke Lord Advises NextEra in Purchase of NET Midstream

© 2015 The Texas Lawbook.

By Mark Curriden

(Aug. 4) – Florida-based NextEra Energy Partners made a huge splash in the Texas energy market Monday when it announced is acquiring seven natural gas pipelines owned by Houston-based NET Midstream for $2.1 billion.

Oil and gas industry analysts said the bid for NET Midstream was very competitive among a handful of pipeline companies.

The gem at the heart of the transaction for NextEra, which mostly focuses on wind and solar power, is the NET Mexico Pipeline, which delivers natural gas from the Eagle Ford Shale to the Mexican border. The acquisition of NET Midstream comes with a valuable 20-year contract with a subsidiary of PEMEX, the Mexican state-owned oil and gas company.

NextEra General Counsel Mitch Ross turned to the energy M&A group at Locke Lord to advise the company on the transaction. Locke Lord partners Bill Swanstrom and Greg Hill, who are based in Houston, led the deal. NextEra assistant general counsel Karina Amelang also played a leading role in the transaction.

NextEra is a long-time client of Locke Lord.

“The transaction posed a lot of legal and financial complexities, including cross border issues, trading issues and financing issues for the MLP structure,” said Hill, a capital markets expert who has also represented Eagle Rock Energy Partners, Sage Midstream, Millennium Midstream and High Point Energy in various financing and fundraising matters.

“The contract with Mexico made the deal significantly more complex, but a lot more valuable, too,” Hill said.

NET Midstream turned to lawyers in the New York office of Latham & Watkins to lead its side of the transaction. Houston lawyers Timothy Fenn and James Cole handled tax related issues for NET Midstream.

Locke Lord partner Scott Arrington also played a key role. Other Locke Lord team members working on the transaction included partners Van Jolas, Ed Razim, Scott Davidson, Tim Johnson and Ann Ryan Robertson. Locke Lord associates who were involved are Jennie Simmons, Eric Larson, Greg Cox, Nick Dickerson, and Ben Smolij and senior counsel Tammi Niven.

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