Other Investments |
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Other Investments | Other Investments In October 2015, Midstream, acquired an initial 1% equity interest in the Mountain Valley Pipeline, LLC. The LLC was established to construct and operate a natural gas pipeline originating in northern West Virginia and extending through south central Virginia. Once completed, the pipeline will have the capacity to transport approximately 2 million decatherms of natural gas per day. Due to ongoing delays primarily attributable to the actions of the Fourth Circuit and FERC, which have suspended previously approved permits allowing for water crossings and access through national forest lands, completing the pipeline has been delayed. Current activity on the pipeline is limited to maintenance and restoration activities. The LLC's managing partner believes they have submitted all of the information required for the suspended permits to be approved and is awaiting approval. As a result, the projected cost of the MVP project has grown to between $5.3 and $5.5 billion with a projected in-service date in late calendar 2020. Midstream's estimated total cash contribution is between $53 and $55 million. The Company is utilizing the equity method to account for the transactions and activity of the investment in MVP and is participating in the earnings in proportion to its level of investment. In April 2018, the LLC announced the Southgate project, which is an approximately 74 mile pipeline extending from the MVP mainline in Virginia to delivery points in North Carolina. Midstream is a less than 1% investor in the project, which is being accounted for under the cost method. Total project cost is estimated to be nearly $500 million, of which Midstream's portion is estimated to be approximately $2.5 million. The Southgate in-service date is currently targeted for calendar year 2021, subject to any further delays in the completion of the MVP mainline. Funding for Midstream's investments in the LLC for both the MVP and Southgate projects are being provided through two variable rate unsecured promissory notes under a non-revolving credit agreement, maturing in December 2022, and two additional notes issued in June 2019. See Note 7 for a schedule of debt instruments. The investments in the LLC are included in the condensed consolidated financial statements as follows:
The change in the investment in unconsolidated affiliate is provided below:
Summary of unaudited financial statements of Mountain Valley Pipeline are presented below. Southgate financial statements, which are accounted for under the cost method, are not included:
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