Crosstex Buys Energy Plant, Facility In Louisiana

DALLAS (AP) — The Crosstex Energy companies said Tuesday that it acquired the Eunice natural gas liquids processing plant and fractionation facility from Phillip Morris, in an effort to cut costs within its natural-gas business.

Crosstex Energy LP and Crosstex Energy Inc. purchased the plant and facility for $42 million, which includes $18 million of assumed debt.

Crosstex managed the plant and facility, which are located in south central Louisiana, under an operating lease with Phillip Morris. By purchasing the plant, the company eliminates the lease operating expense, improving Crosstex's adjusted cash flow by an estimated $12 million per year. Crosstex previously said its adjusted cash flow is a non-GAAP measure of the partnership's cash flow after it has satisfied the capital and related requirements of its operations. It includes net income before interest, income taxes, depreciation and amortization, stock-based compensation, noncash mark-to-market items and other miscellaneous noncash items.

The Eunice plant processes natural gas, separating the natural-gas liquids found in the gas stream and producing pipeline-quality dry natural gas for numerous customers. The plant processes about 380 million cubic feet of natural gas per day and is capable of processing up to 1.2 billion cubic feet of gas per day.

The fractionation facility separates mixed natural-gas liquid into products such as ethane, propane, normal butane, isobutane and natural gasoline. It is connected to Crosstex's underground storage unit at Napoleonville, La. and to pipeline distribution systems for the sale of natural-gas liquids products in the Napoleonville and Mississippi River markets.