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ArcLight takes majority control of NGPL amid rising energy demand

The fund managed by ArcLight Capital Partners has acquired 25% of Natural Gas Pipeline Company of America, bringing its total stake to 62.5% alongside Kinder Morgan.

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ArcLight Capital Partners, an investment firm specialising in energy infrastructure, announced it has acquired an additional 25% stake in Natural Gas Pipeline Company of America (NGPL), one of the largest natural gas transportation networks in the United States. The transaction increases ArcLight’s total economic interest in NGPL to 62.5%, making it the principal shareholder ahead of Kinder Morgan, Inc., which retains a 37.5% stake and continues to operate the system.

A strategic network at the heart of growing demand

NGPL’s network spans approximately 9,100 miles across nine US states and includes compressor stations with an installed capacity of around 1 million horsepower, along with 288 billion cubic feet of storage. The system supplies key markets for electricity and heating and serves liquefied natural gas (LNG) infrastructure in Texas and Louisiana.

This infrastructure enables the delivery of natural gas from all major US production basins, bolstering supply security for industrial, residential and technology markets. NGPL is central to supply strategies for data centres, LNG exporters and large-scale technology companies known as “hyperscalers”, whose energy consumption continues to grow.

Strengthened positioning in the North American market

“The United States is seeing historic growth in electricity demand, driven in particular by electrification and artificial intelligence,” said Dan Revers, founder of ArcLight. He added that assets like NGPL will be essential in meeting increasing infrastructure demands for reliability and capacity.

Lucius Taylor, partner at ArcLight, stated that NGPL is a strategic asset “that could not be replicated today” due to its geographic reach and ability to support the growing needs of utilities and LNG exporters. The acquisition continues ArcLight’s strategy, active in the sector since 2001.

Investment history and operational capabilities

Since its inception, ArcLight has owned, controlled or operated more than 65 GW of power assets and around 47,000 miles of electricity and gas transmission infrastructure, with a combined enterprise value of $80bn. The firm states that its industry expertise enables it to provide tailored solutions for emerging market demands, particularly related to data centres and artificial intelligence.

The financial terms of the transaction were not disclosed. Barclays Capital Inc. acted as financial advisor, while Latham & Watkins LLP provided legal counsel to ArcLight.

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