American Midstream Buys Chatom Plant

American Midstream Partners LP (NYSE: AMID) plans to buy an 87.4% interest in the Chatom processing and fractionation plant and associated gathering infrastructure from Quantum Resources Management LLC for about $51 million in cash and credits.

The effective date of the acquisition is July 1, 2012. Chatom is in Washington County, Alabama, approximately 15 miles from American Midstream's Bazor Ridge processing plant in Wayne County, Mississippi, and consists of a 25 million cubic feet per day refrigeration processing plant, a 1,900 barrel per day fractionation unit, a 160 long-ton per day sulfur recovery unit, and a 29-mile gas gathering system.

Brian Bierbach, president and chief executive of American Midstream partners says, "Chatom is a strategic asset that complements our Bazor Ridge assets and is accretive on a DCF per unit basis. Given the current volatility in commodity prices, we will be waiting to increase distributions, as we had previously announced, until the asset is fully integrated into our existing operations. Looking forward, Chatom expands our regional service offering by providing fractionation and sulfur recovery and is ideally located for future growth. We remain excited about our backlog of expansion opportunities that we believe will drive long-term value for our unitholders."