What’s the issue?
DTE Energy has been participating in the midstream arena for years, but recently decided to spin off its midstream business into a separate publicly traded entity.
Why does it matter?
The new entity, DT Midstream, generates its revenue exclusively from gathering, pipeline and storage services.
What’s our view?
The new company is moving quickly to establish itself as a leader in the market for environmentally conscious operations even though more than half of its most recent quarterly net income comes from interstate pipelines that it does not directly operate. Those equity interests, including long contract tenure and new pipeline, may make it an attractive candidate for acquisition, either by its current partners in those pipelines or by a third party.
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