National Fuel Gas Company announced it has entered into a definitive agreement to acquire CenterPoint Energy’s natural gas distribution operations in Ohio for a total consideration of $2.62bn. The transaction, conducted on a cash-free, debt-free basis, will allow National Fuel to double the size of its regulated rate base and increase cash flow diversity in a jurisdiction supportive of natural gas.
The deal includes all equity interests of CenterPoint Energy Resources Corp. in CNP Ohio, encompassing approximately 5,900 miles of distribution and transmission pipeline, serving nearly 335,000 residential, commercial, industrial and transportation customers. These customers collectively consume about 60 billion cubic feet of natural gas annually. Closing is expected in the fourth quarter of 2026, pending review by the Public Utilities Commission of Ohio and other standard regulatory approvals.
Strategic expansion into neighbouring state
By entering the Ohio market, National Fuel extends its operations into a third state adjacent to its current footprint in New York and Pennsylvania. The combined gas distribution portfolio will serve 1.1 million customers across three cold-weather states. The company’s consolidated regulated rate base will reach approximately $3.2bn, rebalancing its business mix towards more stable and predictable activities.
Ohio’s regulatory and political environment is considered favourable to gas infrastructure investments, with mechanisms allowing timely recovery of capital expenditures. The acquisition gives National Fuel new reinvestment opportunities for free cash flow generated from its upstream and gathering segments.
Financing structure and credit profile
The acquisition will be funded through a mix of debt, free cash flow and a limited equity issuance, with the objective of maintaining the company’s investment-grade credit rating. National Fuel expects the transaction to be immediately accretive to regulated earnings per share, excluding acquisition-related costs.
The acquisition is expected to have a neutral impact on adjusted consolidated results for fiscal 2028, the first full year post-closing, and to become accretive thereafter. By increasing its regulated revenue share, the company strengthens its financial profile and long-term dividend outlook, with an uninterrupted dividend record since 1902.
Workforce integration and service continuity
CNP Ohio employees will join National Fuel’s workforce, with the company aiming for a seamless service transition. National Fuel intends to uphold the current standards of safety and reliability for existing customers while leveraging operational and cultural compatibility between the two entities.
The acquisition represents a key step in National Fuel’s strategy to grow its regulated business by integrating adjacent assets within its historical geographic footprint.
