Snam might not be a household name among U.S. midstream operators, but in Europe this Milan, Italy-based company ranks as the continent’s largest gas utility. Now, Snam is eyeing to grab a slice of the American shale revolution in what would mark its first international presence. Reese Energy Consulting today is studying the latest news from Italy’s Snam, which is working on a bid to snag a 33% stake of the Rover pipeline sold by Energy Transfer. The company also is flirting with the idea of a complete buyout from the two private equity firms that hold the remaining shares. The 713-mile Rover transports 3.25 bcf/d of natural gas from the Marcellus and Utica shale plays to the U.S. Midwest and Michigan, where it then can be transported into Canada. While other bidders hope to acquire the single stake up for auction, sources close to Snam say the company may consider submitting a joint bid with its financial investors to sweeten the pot. Whether or not the Italian utility emerges the winner, Snam is on a quest to create a footprint outside of Europe where return rates on midstream investments continue to decline.
Posted on September 13, 2019