(Sharecast News) - Diversified Gas and Oil has entered into binding agreements to acquire two separate packages of "margin enhancing" natural gas gathering systems in the US.
The AIM-listed group will purchase the Pennsylvania and West Virginia-based assets for an aggregate cash consideration of $7.5m.
The combined assets make up approximately 1,700 miles of low-pressure wet and dry gas gathering pipelines, together with compressors, measurement stations and related facilities and equipment.
Along with the systems, DGOC expects to hire several midstream employees who, with their previous experience operating the system, will be "instrumental in efficiently integrating and operating" the assets.
Chief executive Rusty Hutson said: "In keeping with DGO's growth strategy, we have capitalized on the opportunity to acquire what has become non-core assets for these sellers.
"These small, yet strategically complementary bolt-on acquisitions will add scale to our midstream capabilities and provide a high level of optionality with regards to both routes to market and improved pricing."
Hutson added that the acquisitions further diversified DGOC's operations and revenue streams and strengthened its long-term ability to control costs and protect margins.
As of 1610 BST, DGOC shares had inched forward 0.33% to 101.83p.
24 Apr 2019 13:09
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