Aqua America and PVR Partners Announce Joint Venture Private Water Pipeline in the Marcellus Shale
BRYN MAWR and RADNOR, Pa., Sept. 20, 2011 /PRNewswire/ -- Aqua America Inc. (NYSE: WTR) ("Aqua") and Penn Virginia Resource Partners, L.P. (NYSE: PVR) ("PVR") today announced that certain of their operating subsidiaries have formed a joint venture, Aqua — PVR Water Services, LLC, to construct and operate a private pipeline system to supply fresh water to natural gas producers drilling in the Marcellus Shale in north-central Pennsylvania. The 12-inch diameter steel pipeline will largely parallel the trunkline of PVR's gathering system in Lycoming County and will share PVR's existing rights-of-way.
PVR is constructing the fresh water pipeline and handling negotiation of water pipeline capacity contracts with producers. Aqua will operate the system when completed and handle water intake supply arrangements. Aqua and PVR each anticipate investing approximately $12 million for construction of the first segment of the project. The joint venture has entered into an agreement with Range Resources - Appalachia, LLC a wholly owned subsidiary of Range Resources Corporation (NYSE: RRC) to supply fresh water to three of Range's water impoundments, and negotiations with other area producers for supply agreements are on-going.
The joint venture has commenced construction of the fresh water pipeline, and limited water delivery is expected before year-end. The entire 18-mile long first segment of the system is currently anticipated to be fully completed and begin regular operation during the first quarter of 2012.
William H. Shea, Jr., Chief Executive Officer of PVR, said, "We are very excited to join with Aqua America in building a private water pipeline to supply Marcellus producers. We are also pleased to welcome Range Resources as an anchor customer on the pipeline. We believe this project is a 'win-win' solution that offers tangible benefits to both the contracting producers and the local communities in which we operate. The pipeline will provide contracting producers with a more reliable fresh water source at a lower delivered cost. By reducing the number of trucks operating on area highways, area residents will benefit from reduced traffic congestion, noise and delays."
Nicholas DeBenedictis, Chairman and CEO of Aqua, said, "Marcellus Shale offers a critical and challenging opportunity for the State of Pennsylvania. Critical because the energy needs of the country must be developed domestically and Pennsylvania can be that provider. Challenging because it must be done in a manner that protects and manages our most precious resource, water. This project is the first that prudently enables the development of the Marcellus while helping to protect our water sheds and manage our supplies. Pumping water through pipe, as opposed to trucking water, reduces road traffic and damage that can result in runoff that can negatively impact streams in this sensitive part of the state. Managing the supply from confirmed reliable sources reduces the potential for over withdrawal from those same streams."
Aqua America (NYSE: WTR) is one of the largest U.S.-based, publicly-traded water utilities and serves almost 3 million residents in Pennsylvania, Ohio, Illinois, Texas, New Jersey, Indiana, Virginia, Florida, North Carolina, Maine, New York and Georgia. Aqua America is listed on the New York Stock Exchange under the ticker symbol WTR.
Penn Virginia Resource Partners, L.P. (NYSE: PVR) is a publicly traded limited partnership which owns and manages coal and natural resource properties and related assets, and owns and operates midstream natural gas gathering and processing businesses. We own approximately 900 million tons of proven coal reserves in Northern and Central Appalachia, and the Illinois and San Juan Basins; our midstream natural gas assets are located principally in Texas, Oklahoma and Pennsylvania and include more than 4,200 miles of natural gas gathering pipelines and 7 processing systems with approximately 420 million cubic feet per day of capacity. For more information about PVR, visit our website at www.pvrpartners.com.
This press release includes "forward-looking statements" within the meaning of federal securities laws. All statements, other than statements of historical facts, included in this release that address activities, events or developments that the joint venture owners expect, believe or anticipate will or may occur in the future are forward-looking statements. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties, factors and risks, many of which are outside the joint venture owners' ability to control or predict, which could cause results to differ materially from those expected by management. Such risks and uncertainties include, but are not limited to, construction risks, regulatory, economic and market conditions, the timing and success of business development efforts and other uncertainties. Additional information concerning these and other factors can be found in the press releases and public periodic filings with the Securities and Exchange Commission by the joint venture owners, including their respective Annual Reports on Form 10-K for the year ended December 31, 2010 and their most recently filed Quarterly Reports on Form 10-Q. Readers should not place undue reliance on forward-looking statements, which reflect management's views only as of the date hereof. The joint venture owners undertake no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
SOURCE Penn Virginia Resource Partners, L.P.
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