Williams Cos. Reaches Deal to Buy Momentum Midstream for Up to $5.5 Billion

Energy News Beat

Tulsa-based The Williams Companies, Inc. (NYSE: WMB) has signed an agreement to acquire Momentum Midstream in a strategic transaction valued at up to $5.5 billion, establishing a premier position in the Haynesville Shale to serve expanding Gulf Coast LNG, power, and industrial demand.

The deal, announced alongside Williams’ strong second-quarter 2026 results on August 3, 2026, involves the purchase of 100% of Momentum Midstream from private equity firm EnCap Flatrock Midstream. Total consideration comprises approximately $3.5 billion in cash and debt assumption plus roughly $2 billion in Williams equity. The implied valuation is about 8.5 times projected 2027 EBITDA. The transaction is expected to be accretive to available funds from operations (AFFO) per share and earnings per share, with predictable fee-based cash flows backed by fixed-fee earnings, take-or-pay contracts, and a high-quality customer base.

Momentum Midstream operates a leading integrated natural gas midstream platform spanning the Haynesville Shale from East Texas to Louisiana. Its assets include more than 4,000 miles of pipeline, over 1 million dedicated acres across four key gathering areas with combined capacity of 6 Bcf/d, multiple processing and treating facilities, and three take-or-pay pipelines capable of transporting 4.05 Bcf/d. The system features 91 interconnects providing 20 Bcf/d of total connectivity, serves more than 140 customers, and connects directly to 10 LNG facilities, 26 power plants, industrial end users, city gates, and petrochemical facilities along the Gulf Coast. A standout asset is the NG3 Pipeline, a roughly 250-mile system with 2.3 Bcf/d capacity that links Haynesville supply to the Gillis, Louisiana hub—a key gateway for LNG demand—and incorporates carbon capture for lower-emission gas delivery.

Williams noted two immediate expansion projects enabled or enhanced by the acquisition: the $1.5 billion Delta Access expansion along the Transco corridor, providing initial capacity of 2.25 Bcf/d (with further upside) targeted for first-quarter 2029 service; and the Shelby Trough Connector, an expansion of Williams’ LEG system offering 750 MMcf/d initial capacity (expandable to 1.5 Bcf/d) expected online in second-quarter 2028.

The deal is subject to customary closing conditions, including Hart-Cottrell-Rodino antitrust clearance. BofA Securities served as lead financial advisor to Williams, with Truist Securities also advising and Davis Polk & Wardwell as legal counsel.

How the Deal Helps Williams

The acquisition deepens Williams’ fully integrated natural gas infrastructure in one of the most important U.S. supply basins feeding Gulf Coast demand. It complements the company’s existing ~30,000-mile network, including its Transcontinental Gas Pipe Line (Transco) and LEG systems, by adding complementary gathering, treating, processing, and takeaway capacity. This enhances basin connectivity, broadens customer reach, and positions Williams to capture a larger share of projected Gulf Coast LNG demand growth of approximately 20 Bcf/d over the next decade, alongside rising power and industrial needs.

CEO Chad Zamarin stated: “Additionally, we are announcing the acquisition of Momentum Midstream, a highly strategic platform that strengthens our position in the country’s most important LNG demand corridor. Alongside the acquisition, we are also announcing an expansion of our LEG gathering system and a large take-or-pay pipeline project along the Transco corridor. We look forward to the Momentum team joining the Williams family as we invest in these impressive assets that serve as a catalyst for continued growth.”

Williams raised its 2026 Adjusted EBITDA guidance midpoint by $200 million to $8.4 billion (range $8.3–$8.5 billion), reflecting the acquisition’s contribution. Pro forma leverage is projected at approximately 3.75x. The fee-based nature of the assets aligns with Williams’ model of stable, contracted cash flows rather than pure commodity exposure. Prior involvement with Momentum-related assets (Williams acquired a 31% operated interest in the M4 Utica system in 2019) provides familiarity that may ease integration.

Benefits for Investors

The transaction is structured to be immediately accretive to key per-share metrics (AFFO and EPS) while adding high-quality, contracted volume growth. Investors gain exposure to long-term secular demand drivers—LNG exports expected to roughly double by decade’s end and rising natural gas use for power generation (including data centers and industrial load)—through a scaled, integrated platform. Raised 2026 guidance and the accompanying organic expansion projects signal continued growth capital deployment into high-return opportunities. The equity component of the consideration (~$2 billion) shares upside with existing shareholders while the cash/debt mix keeps leverage manageable. Overall, it reinforces Williams’ position among large midstream peers focused on fee-based infrastructure serving export and power markets.

Benefits for Consumers

Greater takeaway capacity from the prolific Haynesville reduces potential bottlenecks, supporting more reliable delivery of natural gas to power plants, industrial facilities, and LNG terminals. This can help stabilize or moderate regional and end-user prices by matching abundant supply with growing demand, while the carbon-capture features of assets like NG3 support lower-emission molecules. Expanded connectivity ultimately underpins energy security for electricity generation, manufacturing, and exports that feed global markets.

Markets Impacted

The primary markets affected are U.S. natural gas midstream infrastructure (particularly Haynesville/Ark-La-Tex gathering and Gulf Coast transportation), LNG exports, gas-fired power generation, and Gulf Coast industrial/petrochemical demand. The deal strengthens competition and capacity in the critical corridor linking one of America’s lowest-cost, highest-growth gas basins to LNG terminals and demand centers. Secondary effects may include midstream equity valuations, private-equity exits in energy infrastructure, and broader natural gas pricing dynamics as incremental capacity comes online. It also intersects with power markets amid rising electricity needs and the ongoing buildout of U.S. LNG export capacity.

This acquisition marks one of the larger midstream deals of recent years and underscores the strategic importance of controlling wellhead-to-water infrastructure in a period of robust natural gas demand growth.

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