Crestwood Midstream Partners LP, Crestwood Holdings Partners LLC and Antero Resources Appalachian Corporation reported the execution of definitive agreements whereby CMLP and Crestwood Holdings, through a newly formed joint venture, have agreed to acquire certain of Antero's Marcellus Shale gathering system assets located in Harrison and Doddridge Counties, West Virginia for $375 million in cash plus an earn-out which would allow Antero to earn additional purchase price payments of up to $40 million based upon average annual production levels achieved during 2012 and 2013. Additionally, at closing, the parties have agreed to enter into a 20-year gas gathering and compression agreement, which will provide for an Area of Dedication of approximately 127,000 gross acres, or 104,000 net acres, largely located in the rich gas window of the southwestern core of the Marcellus Shale play. The transaction will have a January 1, 2012 effective date and is expected to close in March 2012, subject to regulatory approvals and customary closing conditions.

Paul M. Rady, Chairman and Chief Executive Officer of Antero, commented that "this is a strategic transaction for Antero that allows us to redeploy capital into further drilling and acreage consolidation in Appalachia. We look forward to working closely with Crestwood as our midstream partner in this development going forward."

"Crestwood is pleased to partner with Antero in the long term development of this exceptional Marcellus Shale acreage," stated Robert G. Phillips, President and Chief Executive Officer of CMLP's general partner. "The transaction is an excellent fit with our strategy and adds to our portfolio another great shale focused producer, a long-term fixed-fee contract and core acreage dedication in the rich gas window of the premier natural gas shale play in the industry. This acquisition will be immediately accretive to CMLP, is supported by a minimum volume commitment and offers tremendous visible growth potential for many years as volumes increase and the systems expand. We are also very pleased to work with First Reserve, through its indirect ownership of Crestwood Holdings, to fashion an acquisition and financing structure that enables CMLP to maintain sufficient liquidity and conservative leverage which highlights the value of strong general partner sponsorship."

Tags: Crestwood Midstream Partners LP