ARCLIGHT ACQUIRES INTEREST IN NATURAL GAS PIPELINE COMPANY OF AMERICA, ONE OF THE LARGEST NATURAL GAS INFRASTRUCTURE ASSETS IN NORTH AMERICA

Rhea-AI Summary

ArcLight Capital Partners has acquired a 25% interest in Natural Gas Pipeline Company of America (NGPL), increasing its total economic ownership to 62.5%. Kinder Morgan (NYSE: KMI) retains a 37.5% stake and continues to operate NGPL. The pipeline system spans 9,100 miles across nine states, featuring compressor stations with ~1 million horsepower and 288 billion cubic feet of storage capacity. NGPL is strategically positioned to serve growing power demand from AI and data centers, while supporting LNG facilities in Texas and Louisiana. The system provides critical energy infrastructure, connecting major U.S. natural gas basins to key markets. ArcLight brings extensive experience in infrastructure management, having overseen ~65 GW of assets and 47,000 miles of transmission infrastructure worth $80bn in enterprise value since 2001.

Positive

• ArcLight increases ownership to become NGPL's largest stakeholder with 62.5% interest
• Strategic positioning to capitalize on growing AI and data center power demand
• Extensive infrastructure coverage with 9,100 miles of pipeline and 288 billion cubic feet of storage
• Access to major U.S. natural gas basins and key LNG facilities in Texas and Louisiana
• Continued partnership with experienced operator Kinder Morgan

Negative

• Transaction terms and financial details not disclosed
• Potential integration challenges with existing operations
• High dependence on future AI and data center demand growth materializing

Insights

Energy Infrastructure Analyst

ArcLight's increased stake in NGPL strengthens KMI's strategic partnership while positioning both for AI and LNG-driven growth opportunities.

This transaction represents a significant strategic development for Kinder Morgan (KMI), as private equity firm ArcLight increases its ownership stake in Natural Gas Pipeline Company of America (NGPL) to 62.5%, while KMI maintains its 37.5% interest and continues operating the asset. Most importantly, this reinforces KMI's partnership with a deep-pocketed investor at a time when natural gas infrastructure is becoming increasingly critical for power generation.

NGPL's infrastructure footprint is substantial - ~9,100 miles of pipeline across nine states, ~1 million horsepower of compression capacity, and 288 billion cubic feet of storage. This positions the company to benefit from two major growth catalysts: the booming data center/AI ecosystem and expanding LNG export facilities.

The strategic rationale centers on anticipated power demand growth driven by AI and data centers. These facilities require enormous electricity supplies, with natural gas remaining a crucial generation source. Similarly, LNG export facilities need reliable gas delivery infrastructure to function efficiently. NGPL's geographic positioning connecting major basins to power markets and Gulf Coast export terminals creates valuable optionality.

For KMI shareholders, this transaction validates the value of these midstream assets while maintaining the company's operational control. The continued partnership with ArcLight, which has deepened its commitment, suggests alignment on the growth potential of this infrastructure system in serving digital infrastructure and energy export markets - two significant long-term demand drivers.

NGPL PROVIDES CRITICAL TRANSPORTATION, STORAGE & RELIABILITY AND IS STRATEGICALLY POSITIONED TO HELP MEET AI, DIGITAL POWER & LNG RELATED GROWTH

BOSTON, May 13, 2025 /PRNewswire/ -- ArcLight Capital Partners, LLC announced its managed fund (collectively, "ArcLight") has acquired a 25% interest in Natural Gas Pipeline Company of America ("NGPL"), a strategic natural gas infrastructure system. As a result of the transaction, ArcLight will become the largest owner of NGPL with a 62.5% economic ownership interest, alongside its strategic partner Kinder Morgan, Inc. (NYSE: KMI). Kinder Morgan continues to own a 37.5% economic interest and operates NGPL. 

NGPL is one of the largest interstate pipeline systems in the country, spanning nine states, supplying critical power and heating markets across its footprint and liquefied natural gas facilities in Texas and Louisiana. With ~9,100 miles of pipeline, compressor stations totaling ~1 million horsepower, and 288 billion cubic feet of storage, NGPL provides critical energy, access, reliability and supply from all major U.S. natural gas basins. 

"The U.S. is seeing historic levels of power demand growth, from both electrification and AI, which we believe will continue well into the next decade. Critical infrastructure assets like NGPL will be increasingly necessary to providing both reliability and the ability to help meet the growing infrastructure needs associated with these two investment mega trends," said Dan Revers, Founder of ArcLight. "This acquisition builds on ArcLight's deep history, dating back to 2001, of investing in critical gas infrastructure."

"We believe NGPL represents a strategic natural gas infrastructure asset that cannot be replicated today and that has significant opportunities to help utilities, LNG exporters, data center developers and hyper scalers meet their growing gas infrastructure needs," said Lucius Taylor, Partner at ArcLight. "This continued investment in NGPL also reflects ArcLight's ability to be a value-added partner and expands our strategic partnership with Kinder Morgan."

Since 2001, ArcLight has owned, controlled, or operated over ~65 GW of assets and 47,000 miles of electric and gas transmission infrastructure with $80bn of enterprise value. With its deep industry experience and suite of internal operational and technical resources, ArcLight believes it is well positioned to deliver the electric infrastructure solutions required by AI and data center power demand. Today, ArcLight manages one of the largest private power infrastructure portfolios in North America.

Terms of the transaction were not disclosed. Barclays Capital Inc. acted as financial advisor and Latham & Watkins LLP acted as legal counsel to ArcLight on the transaction.

About ArcLight:
ArcLight is a leading infrastructure investor which has been investing in critical electrification infrastructure since its founding in 2001. ArcLight has owned, controlled or operated over ~65 GW of assets and 47,000 miles of electric and gas transmission and storage infrastructure representing $80bn of enterprise value. ArcLight has a long and proven history of value-added investing across its core investment sectors including power, hydro, solar, wind, battery storage, electric transmission and natural gas transmission and storage infrastructure to support the growing need for power, reliability, security, and sustainability. ArcLight's team employs an operationally intensive investment approach that benefits from its dedicated in-house strategic, technical, operational, and commercial specialists, as well as the firm's ~1,900-person asset management partner. For more information, please visit www.arclight.com.

About Kinder Morgan:
Kinder Morgan, Inc. (NYSE: KMI) is one of the largest energy infrastructure companies in North America. Access to reliable, affordable energy is a critical component for improving lives around the world. We are committed to providing energy transportation and storage services in a safe, efficient and environmentally responsible manner for the benefit of the people, communities and businesses we serve. We own an interest in or operate approximately 79,000 miles of pipelines, 139 terminals, more than 700 Bcf of working natural gas storage capacity and have renewable natural gas generation capacity of approximately 6.9 Bcf per year. Our pipelines transport natural gas, refined petroleum products, crude oil, condensate, CO₂, renewable fuels and other products, and our terminals store and handle various commodities including gasoline, diesel fuel, jet fuel, chemicals, metals, petroleum coke, and ethanol and other renewable fuels and feedstocks. Learn more about our work advancing energy solutions on the lower carbon initiatives page at www.kindermorgan.com.

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/arclight-acquires-interest-in-natural-gas-pipeline-company-of-america-one-of-the-largest-natural-gas-infrastructure-assets-in-north-america-302453172.html

SOURCE ArcLight Capital Partners

FAQ

What percentage stake did ArcLight acquire in NGPL from the KMI deal?

ArcLight acquired a 25% interest in NGPL, bringing its total economic ownership to 62.5%, while Kinder Morgan (KMI) retains 37.5%.

What is NGPL's current infrastructure capacity and coverage?

NGPL operates ~9,100 miles of pipeline across nine states, with compressor stations totaling ~1 million horsepower and 288 billion cubic feet of storage capacity.

How does the NGPL acquisition align with AI and data center growth?

NGPL is strategically positioned to provide natural gas infrastructure supporting growing power demands from AI and data centers, while serving LNG facilities in Texas and Louisiana.

What is ArcLight's track record in infrastructure investments?

Since 2001, ArcLight has managed ~65 GW of assets and 47,000 miles of electric and gas transmission infrastructure with $80bn of enterprise value.

Who will operate NGPL after ArcLight's increased ownership?

Kinder Morgan will continue to operate NGPL despite ArcLight becoming the largest owner.