SK Holdings (CEO Jang Dong-hyun), an investment holding company, is entering the North American shale gas G&P (Gathering & Processing) business. SK Holdings announced on the 26th that it has decided to invest over $100 million in Eureka Midstream Holdings, a North American G&P company with the highest profitability and growth potential.

Accordingly, a share purchase agreement will be signed on the 27th (local time) through Plutus Capital, SK Holdings' US subsidiary. This move is aimed at strengthening the midstream capabilities of the global natural gas business, one of its future growth engines. SK expects this investment to generate synergies with its existing energy business as well as facilitate further business expansion.

The G&P business, which is unfamiliar in Korea, refers to the gathering of natural gas produced from gas fields (wells) and transporting it through pipelines, and the processing service business, which removes impurities from the transported natural gas and processes it to make it suitable for transportation and sale to end consumers.

Eureka is a G&P specialist located in the Marcellus-Utica Basin of Pennsylvania and Ohio. It owns gathering pipelines capable of transporting 17 million tons of natural gas annually. It holds long-term contracts with fixed fees, averaging over 10 years, and holds exclusive processing rights for gas production in specific regions, ensuring high business stability. Eureka also boasts industry-leading profitability, with an EBITDA margin of 66%...

 

source: Maeil Business Newspaper