Phillips 66 (NYSE: PSX) announced today the sale of its 25% non-operated stake in Rockies Express Pipeline LLC (REX) to a Tallgrass Energy, LP (TGE) subsidiary for approximately $1.275 billion. TGE, already the operator of REX, will now own 100% of its common equity. After adjustments for debt and preferred equity, Phillips 66 expects pre-tax cash proceeds of $685 million from the transaction.
Mark Lashier, Chairman and CEO of Phillips 66, emphasized, “This sale marks a significant step in our strategy to divest over $3 billion in assets. We’re focused on optimizing our portfolio and unlocking value from assets no longer aligned with our long-term plans.”
The proceeds are intended to bolster Phillips 66’s strategic initiatives, including shareholder returns. REX, spanning 1,714 miles, ranks among the largest natural gas pipelines in the U.S., facilitating bi-directional transport of over 5 billion cubic feet per day between the Rockies, Appalachia, and the northeastern U.S.
