CONROE: Sapphire Gas Solutions, a distributed energy infrastructure provider, has acquired assets from Spectrum LNG, including an operating liquefied natural gas facility in Arizona and a site for future development in Oklahoma, the company announced Monday.

The acquisition includes the Desert Gas LNG Plant in Ehrenberg, Arizona, which has approximately 100,000 gallons of LNG storage capacity and about 76,000 gallons per day of operational production capacity. The facility receives natural gas from TC Energy’s North Baja pipeline and supplies LNG to municipal, commercial and industrial customers across the region.

The deal adds LNG production capabilities to Sapphire’s existing natural gas services in the Southwest U.S. and Southern California and advances the company’s strategy of building a vertically integrated merchant LNG platform, according to the announcement.

“Spectrum gives Sapphire an established LNG production base in the Southwest at a time when demand for reliable, flexible natural gas continues to grow,” said Sam Thigpen, CEO of Sapphire Gas Solutions. “The Desert Gas facility further advances our vertically integrated model allowing Sapphire to provide customers with a more complete and unified service.”

Spectrum has increased its LNG delivery to customers by more than 15% annually since 2021, reflecting continued growth in regional demand for small-scale LNG, the company said.

The acquisition also provides Sapphire with additional infrastructure and expansion opportunities in Oklahoma.

“This transaction comes at a strategic time for Spectrum as we expand our footprint in Alaska,” said Ray Latchem, CEO of Spectrum LNG and SES Midstream. “Sam and the Sapphire team have been a customer of Spectrum for a long time, and we are confident that integrating these assets into the great platform of Sapphire will provide a top-tier service and product to the regional markets near Ehrenberg.”

The Spectrum acquisition follows Sapphire’s recent purchase of EDGE LNG and its strategic partnership earlier this year with Antin Infrastructure Partners, a private equity firm focused on infrastructure.

“The Southwest U.S. and Southern California are important markets for Sapphire, and Spectrum gives us the ability to serve it with greater scale and flexibility,” Thigpen said. “We see significant opportunity to build on Spectrum’s existing relationships and expand LNG solutions for municipalities, industrial customers and other users looking for dependable alternatives to traditional energy infrastructure.”

Piper Sandler & Co. served as financial advisor and Hall Estill LLP acted as legal advisor to Spectrum LNG. Orrick, Herrington & Sutcliffe LLP advised Sapphire on the transaction, with a team led by Joe Roger, Adam Kowis and Nick Woodruff.

Sapphire Gas Solutions, headquartered in Conroe, Texas, operates across 30 states and serves more than 120 customers across utility, commercial, industrial and renewable natural gas sectors. The company provides CNG, LNG and RNG solutions through a network of production, transportation, storage and distribution assets.