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Williams Companies Announces Organizational Realignment

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Williams Companies, Inc. (WMB - Free Report) recently announced that it has introduced certain changes in the organization to simplify its structure as well as enhance direct operational alignment. The move is aimed at the development of the company’s proven, natural gas-focused strategy and to retain focus on customer service and execution.

Williams intends to consolidate the number of Operating Areas within the company to three – Atlantic-Gulf, West and Northeast Gathering & Processing – from five, by early 2017.

According to the organizational changes, NGL & Petchem Services operations in the Gulf area, the Geismar olefins plant, the refinery grade propylene splitter and pipelines in the Gulf Coast region will be incorporated into the Atlantic-Gulf Operating Area. Atlantic-Gulf will retain the Transco interstate gas pipeline, which is the nation’s largest and fastest-growing interstate natural gas transmission pipeline system. Transco is a 10,200-mile network with a mainline that extends nearly 1,800 miles between South Texas and New York City. . Substantial natural gas gathering and processing, and crude oil production and handling and transportation in the Gulf Coast region will also be included under Atlantic-Gulf. Rory Miller, a 30-year energy industry veteran who has led the area since 2013, will continue to work in the same capacity.

The West Operating Area will include all gathering systems, operations and commercial activities in the Barnett, Eagle Ford and Haynesville shales, the Mid-Continent region and Permian Basin. It will also comprise the Northwest Pipeline interstate gas pipeline system as well as gathering, processing and treating operations in Wyoming, the Piceance Basin and the Four Corners area. Moreover, an NGL fractionator and storage facilities near Conway, KS, a rail loading facility at Hutchinson, KS and a 50% equity-method interest in Overland Pass Pipeline will be operated within the West Operating Area. Also, included is a non-operated 50% interest in the Delaware Basin gas gathering system in the Permian Basin region. The consolidated West Operating Area will be headed by Walter Bennett, who has led the West Operating Area since joining Williams in 2014.

Operations in Pennsylvania, West Virginia, Ohio and New York will continue to remain under the Northeast Gathering & Processing Operating Area. The area comprises the Susquehanna Supply Hub and Ohio Valley Midstream. It also includes a 69% equity investment in Laurel Mountain Midstream and a 58.4% equity investment in Caiman Energy II, which owns a 50% interest in Blue Racer Midstream. Jim Scheel, who joined Williams in 1988, will continue to lead the Northeast Gathering & Processing Operating Area.

Financial reporting under the new organizational alignment is expected to be effective from early January, in concurrence with the implementation of related management changes.

Notably, the company has announced a series of actions, including its strategic plan, since early July. Williams’ stock has also increased in value by about 42% since.

Williams Companies currently carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy sector are Matador Resources Company (MTDR - Free Report) , NGL Energy Partners LP (NGL - Free Report) and Enviva Partners L.P. (EVA - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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