Shell must divest to be allowed to acquire

Nov 16, 1998 01:00 AM

Oct. 1, 1998 The Federal Trade Commission has said that Shell must divest 171 miles of natural gas pipeline in Oklahoma and Texas as a condition to acquire the natural gas gathering assets of The Coastal Corporation.
Shell, through its subsidiary Tejas and, in turn, its subsidiary Transok LLC, will acquire some gas gathering assets of the Coastal subsidiaries ANR Field Services Co. and ANR Production Co.

FTC officials said they were concerned that if Shell's Transok completed its proposed acquisition of ANR's facilities in western Oklahoma, the Oklahoma and Texas Panhandles and south-western Kansas, as well as a natural gas processing plant in Oklahoma, there would be a decrease in competition for "gas gathering" in western Oklahoma and the Texas Panhandle.
The proposed FTC order requires the divestiture of certain pipelines by Jan. 5, 1999, or 30 days after the acquisition is complete. Otherwise, the FTC can appoint trustees to sell the facilities and any other pipelines or hardware needed to assure that the assets are marketable.
Transok was acquired by Shell in January as part of its acquisition of Tejas.

"Gas gathering" is the transport of natural gas from the wellhead to a processing plant or transmission pipeline, from which it is, in turn, sent to local distribution companies and on to homes and factories.

Source: not available
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