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Chesapeake Utilities Corporation to Acquire Elkton Gas -oilandgas360

 

Chesapeake Utilities Corporation (Chesapeake Utilities) (NYSE: CPK) and South Jersey Industries (SJI) (NYSE: SJI) today announced they have entered into an agreement, dated Dec. 5, 2019, under which Chesapeake Utilities will acquire SJI subsidiary Elkton Gas, which operates in Cecil County, Maryland. Upon completion of the transaction, Elkton Gas will become a wholly-owned subsidiary of Chesapeake Utilities. The transaction was approved by the SJI Board of Directors and by Chesapeake Utilities’ Investment Committee, which is comprised of five of the Company’s Board members. The acquisition, which is expected to close in the first half of 2020, is subject to approval by the Maryland Public Service Commission.

Incorporated in 1863, Elkton Gas delivers safe, reliable and affordable natural gas to approximately 7,000 residential and commercial customers within a franchised area of Cecil County, Maryland. Elkton Gas will continue to operate out of its existing office with the same local personnel. Customers can expect to continue to receive the same high quality service that they have experienced with the local office and its team members. Elkton Gas has also been a long-term custom

er of Eastern Shore Natural Gas Company, an interstate transmission pipeline company that is a wholly-owned subsidiary of Chesapeake Utilities Corporation.

Chesapeake Utilities currently serves another franchised area of Cecil County, Maryland with natural gas service and has been managing its expansion into this area largely from its Delaware operations.

“This is an exciting fit and aligns with our Company’s growth strategy to identify new investment opportunities to further our future earnings growth.  The acquisition of Elkton Gas is significant in that it jumpstarts our current operation, enabling us to more quickly expand our footprint in Cecil County,” said Jeff Householder, President and CEO of Chesapeake Utilities Corporation. “We are excited about our prospects for natural gas distribution growth in this growing area and are committed to delivering superior service to the customers and communities we serve by: increasing their energy options; growing our systems and infrastructure in order to provide safe and reliable delivery of energy to customers; and providing exceptional customer service.”

“Acquiring these operational resources in Cecil County offers close proximity to the I-95 interstate corridor and to our existing Cecil County service territory which will better position us for the commercial, industrial and residential growth opportunities projected for the area,” said Shane Breakie, Vice President of Chesapeake Utilities Corporation, who oversees the Company’s Delmarva natural gas operations including Cecil County. “Adding the Elkton Gas platform including their talented team of employees to our existing presence creates a stronger consolidated operation to better support customers and the natural gas infrastructure in the area.”

The specific terms of the transaction were not publicly disclosed. The transaction is expected to close in the first half of 2020.


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