Dominion Energy Inc. agreed to sell its West Virginia natural gas utility for $690 million, its third big sale of gas assets within two years, as the U.S. energy giant focuses on its larger state-regulated utilities in five key states.
Dominion is selling its Hope Gas business to Ullico Inc.’s infrastructure fund in a deal expected to close later this year, the Richmond, Virginia-based company said Friday in a statement. The move follows last year’s $2 billion sale of Questar Pipelines to Southwest Gas Holdings Inc. and its $2.7 billion sale of gas transmission and storage assets to Berkshire Hathaway Inc. in 2020.
“Our strategy is anchored on a pure-play state-regulated utility operating profile,” Chief Executive Officer Bob Blue said Friday during the company’s quarterly earnings call. “As we thought about capital allocation, it made sense to us to think about divesting that great company.”
Dominion, which sells power to about 7 million customers, wants to focus on larger regulated gas and electric utilities in Virginia, Ohio, Utah and the Carolinas. Hope Gas serves about 111,000 customers in West Virginia. Proceeds from the sale will be used to pay down debt.
“In coming years we’ll use that debt capacity, albeit modest, to invest in our spending programs in our key regulated states,” Blue said in the call.
Dominion also said it raised its five-year capital spending plan to $37 billion, with the bulk of that money going toward investments like offshore wind, solar farms, energy storage and nuclear power. Dominion earlier reported fourth-quarter earnings that missed the average analyst estimate, with operating revenue coming in less than expected.
Shares of Dominion rose 1.2% to $79.19 at 12:33 p.m. trading in New York.
