S&P: Boardwalk unchanged

Standard & Poor's said news that Boardwalk Pipeline Partners LP's formed a joint venture with an affiliate of its general partner to acquire natural gas storage operations will not affect the ratings or outlook.

The agreement to acquire Petal Gas Storage LLC and Hattiesburg Gas Storage Co. from Enterprise Products Partners LP for $550 million in cash will add fee-based cash flow under long-term contracts with mostly creditworthy utility counterparties, S&P said.

The joint venture could enhance Boardwalk's business risk profile over time with predictable, long-term cash flows at a relatively small initial cost, the agency said.

Boardwalk expects the joint venture to fund the purchase with proceeds from a $200 million five-year bank loan and equity contributions, S&P said.

Boardwalk Pipelines Holding Corp., an affiliate of Loews Corp., will own 80% of the joint venture and contribute $280 million of equity and Boardwalk will own 20% and contribute $70 million, the agency said.

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