INVESTMENTS IN EQUITY INVESTEES

6 Months Ended

Mar. 31, 2022

Investments, All Other Investments [Abstract]

7. INVESTMENTS IN EQUITY INVESTEES

The Company's investments in equity method investees include the following as of:


(Thousands)	March 31, 2022		September 30, 2021
Steckman Ridge (1)	$	108,501	$	109,050
PennEast	1,479		5,479
Total	$	109,980	$	114,529

(1)Includes loans with a total outstanding principal balance of $70.4 million for both March 31, 2022 and September 30, 2021, which accrue interest at a variable rate that resets quarterly and are due October 1, 2023.

Steckman Ridge

The Company holds a 50 percent equity method investment in Steckman Ridge, a jointly owned and controlled natural gas storage facility located in Bedford County, Pennsylvania. NJNG and Energy Services have entered into storage and park and loan agreements with Steckman Ridge. See Note 15. Related Party Transactions for more information on these intercompany transactions.

PennEast

The Company, through its subsidiary NJR Midstream Company, is a 20 percent investor in PennEast, a partnership whose purpose was to construct and operate a 120-mile natural gas pipeline that would have extended from northeast Pennsylvania to western New Jersey.

During the third quarter of fiscal 2021, the PennEast partnership determined that this project was no longer supported, and all further development ceased. The Company recognized an other-than-temporary impairment charge of $92.0 million, or approximately $74.5 million, net of income taxes, which represents the best estimate of the salvage value of the remaining assets of the project. Other-than-temporary impairments are recorded in equity in earnings (losses) of affiliates in the Unaudited Condensed Consolidated Statements of Operations.

On December 16, 2021, the FERC dismissed PennEast’s pending applications. The order vacates the certificate authorization for the PennEast pipeline project in light of PennEast’s response to FERC staff’s November 23, 2021 request for a status update, in which PennEast informed the Commission it is no longer developing the project.

On March 10, 2022, following the sale of certain project related assets and refunds of interconnection fees received from interstate pipelines, the PennEast board of managers approved a cash distribution to members of the partnership totaling $4.0 million per partner. The return of capital was received by the Company on March 31, 2022, and reduced the remaining carrying value of its equity method investment in PennEast to $1.5 million in the Unaudited Condensed Consolidated Balance Sheet.