(Reuters) - Williams Partners LP (WPZ.N) said on Monday it would sell its stake in a unit that owns 88.46 percent of an olefins plant in Louisiana to Nova Chemicals for $2.1 billion in cash, as part of the pipeline operator's efforts to focus on natural gas.
The company said its units would enter into long-term supply and transportation agreements with Nova after the deal closes, expected by this summer.
Williams Partners, which put the Geismar, Louisiana plant on the block in September, said it expects to generate 97 percent of its fee-based revenue from natural gas sales after the close of the asset sale.
The plant produces about 1.95 billion pounds of ethylene annually and was rebuilt in 2014, following an explosion a year earlier that left two workers dead and 167 injured.
Ethylene is a key component used to make chemicals, but prices of the commodity have suffered due to over-supply in the U.S. market.
Williams Cos Inc (WMB.N), which controls and is the majority shareholder of Williams Partners, has also said it is focused on growing natural gas volumes after the collapse of its more than $20 billion takeover by Energy Transfer Equity LP (ETE.N).
Williams Partners said it planned to use the deal proceeds to pay off $850 million of its debt, and fund a portion of its capital and investment expenses.
Calgary-based Nova Chemical is owned by International Petroleum Investment Company, set up by the Abu Dhabi government to invest in the energy and related sectors.
Morgan Stanley and Centerview Partners LLC were financial advisers to Williams Partners, while Gibson, Dunn & Crutcher LLP and Kean Miller LLP provided legal counsel.
Reporting by Ahmed Farhatha in Bengaluru; Editing by Sriraj Kalluvila