The temperature isn’t the only thing heating up this summer— especially in the midstream. The sector is seeing plentiful activity this season with more than $1 billion in acquisitions announced in June and early July.
In the period’s largest acquisition, BreitBurn Energy Partners LP purchased Whiting Oil and Gas Corp.’s interests in the Postle and North East Hardesty oil fields, as well as associated midstream assets. The Oklahoma Panhandle acquisition carried an $860-million price tag.
“We expect this acquisition to generate significant accretion to our distributable cash flow per unit and create long-term value for unitholders,” BreitBurn’s Chief Executive Hal Washburn said in a statement.
“These assets are an excellent fit for our portfolio, with significant recoverable oil in place and a long horizon of production visibility. We anticipate a decade or more of very low decline production from these assets, which balances some of our more development-focused acquisitions completed last year,” he said.
As well, Crestwood Midstream Partners LP announced in June that its subsidiary Crestwood Niobrara LLC would acquire a 50% interest in Jackalope Gas Gathering Services LLC. It paid RKI Exploration & Production $108 million for the stake. Access Midstream Partners LP owns the other half of Jackalope.
The Jackalope system will gather and process natural gas in Converse County, Wyoming. In a release, Crestwood said the system would give the company an early-stage entrance into Powder River basin. The move also puts Crestwood in a good position for future infrastructure development, the company added. The acquisition is expected to close in the third quarter.
“Crestwood has been focusing its development efforts on rich gas plays such as the Powder River basin Niobrara shale,” Crestwood Chief Executive Robert G. Phillips said in a statement. “This transaction is an important next step in the development of that strategy and positions Crestwood in a growing play with an experienced midstream partner supported by a long-term contract and large acreage dedication being developed by very capable shale producers.”
Meanwhile, Buckeye Partners LP priced $500 million of unsecured notes. The 4.15% notes mature July 1, 2023. The company said it would use proceeds to repay debt and for general partnership purposes.
Recommended Reading
Eni Reports Discovery Offshore Mexico in Block 9
2024-07-10 - Italian energy giant Eni SpA announced a discovery at the Yopaat-1 EXP exploration well in the offshore Mexico Block 9 of the Cuenca Salina in the Sureste Basin, which potential up to 400 MMboe in place.
E&P Highlights: July 10, 2024
2024-07-10 - Here’s a roundup of the latest E&P headlines including TotalEnergies exiting South Africa to focus on opportunities in Namibia.
CNOOC’s Bohai Bay Well Achieves High Yield
2024-07-11 - CNOOC’s Bozhong 19-6 Condensate Gas Field D1 well, the first ultra-deep well in China’s Bohai Bay, is currently producing approximately 6,300 boe/d.
Goodbye Manual Control: Vital Energy’s Automation Program Boosts Production
2024-07-12 - Production, ESP efficiency soared when the company automated decisions with AI at the edge.
VAALCO Reports Increased Reserves After Svenska Deal
2024-07-16 - VAALCO acquired Swedish E&P Svenska’s 27.39% non-operated working interest in the deepwater Baobab Field in Block CI-40, offshore Côte d’Ivoire.