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Kinder Morgan is set to acquire Indianapolis-based Kinetrex Energy from an affiliate of Illinois-based Parallel49 Equity investment company, the Houston pipeline operator said Friday.

The $310 million deal includes two small-scale, domestic liquefied natural gas production and fueling facilities, a 50 percent interest in a landfill renewable natural gas facility and three additional RNG facilities with signed commercial arrangements. 

Kinder Morgan in March formed an Energy Transition Ventures group within Kinder Morgan to identify, analyze and pursue commercial opportunities emerging from the low-carbon energy transition.

In addition to being a leading supplier of liquefied natural gas in the Midwest, Kinetrex produces and supplies renewable natural gas under long-term contracts to transportation service providers. 

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RNG is made from renewable sources, including organic waste in landfills, wastewater treatment plants and agricultural operations. By capturing the methane produced from the decomposition of organic waste, the RNG production process reduces or eliminates greenhouse gas emissions. 

Kinetrex has a 50 percent interest in the largest RNG facility in Indiana and has signed commercial agreements to begin construction on three additional landfill-based RNG facilities that are expected to become operational over the next 18 months, according to the release. 

Once operational, total annual RNG production from the four sites is estimated to be over four billion cubic feet. 

The transaction, subject to regulatory approval, is expected to close in the third quarter of 2021. After close, Kinetrex President and CEO Aaron Johnson will join Kinder Morgan and continue his role as president of RNG. 

“This is a great day in the young history of Kinder Morgan Energy Transition Ventures,” Kinder Morgan ETV President Jesse Arenivas said in the release. “We have been focused on RNG due to its potential to grow rapidly in the near term and deliver attractive returns, with landfills providing a low cost, predictable and long-term feedstock. The team at Kinetrex has developed an outstanding business model and platform for future growth in a fragmented market, and we are excited to welcome them to Kinder Morgan.”