Page 11 - NorthAmOil Week 25

NorthAmOil
NEWS IN BRIEF
NorthAmOil
UPSTREAM
Alliance Resource Partners
announces agreement to
acquire Permian Basin oil
and gas mineral interests
Alliance Resource Partners (ARLP) today announced that it has entered into a de nitive agreement to acquire oil and gas mineral interests from Wing Resources and Wing Resources II for a cash purchase price of $145.0mn. Upon closing, the transaction will increase ARLP’s presence in the Permian Basin through the addition of approximately 9,000 net royalty acres in the Midland Basin, with exposure to more than 400,000 gross acres.
ere are 783 gross horizontal wells currently producing on the acreage to be acquired delivering an estimated 460 boe per day (70% oil, 14% NGLs) net to the Wing interests. With an additional 441 drilled but uncompleted wells and 279 permits, these assets are under active development by well- capitalized operators bringing visible and near-term growth to current production.
“Today’s announcement re ects ARLP’s commitment to build its oil and gas minerals segment as a growth platform for the future,” said Joseph W. Cra III, chairman, president and chief executive o cer. “ e Wing acquisition enhances our already signi cant ownership position in the proli c, liquids- rich Permian Basin and, upon completion, these assets are expected to complement
our existing coal and oil and gas businesses, contributing to long-term cash ow growth
for ARLP and value creation for our unitholders.”
ARLP will fund the purchase with cash on hand and borrowings under its credit facility. e agreement provides for an e ective date of May 1, 2019 and the transaction is expected to close in early August 2019.
Following the acquisition of Wing’s assets, ARLP will directly own approximately 51,000 net royalty acres concentrated in the Permian Basin (47.0%), SCOOP/STACK (40.0%), Bakken (8.0%) and Appalachian Basin (5.0%). ARLP also indirectly owns approximately 3,950 net royalty acres through its limited partner interest in AllDale Minerals III. ALLIANCE RESOURCE PARTNERS, June 24, 2019
MIDSTREAM
Blue Racer considering $2.5bn IPO
Blue Racer Midstream is considering an initial public o ering (IPO) that could be valued
at $2.5bn, Bloomberg has reported, citing sources familiar with the matter.
According to the sources, the company is working with advisers to evaluate a potential IPO.
e Dallas-based gas pipeline operator is
a 50:50 joint venture between private equity rm First Reserve and Caiman Energy II. e latter is funded by Williams, Oaktree Capital Management and EnCap Flatrock Midstream.
Blue Racer was formed in 2012 through a joint venture between Dominion Energy and Caiman Energy II.
Dominion sold its 50% stake in the
company to First Reserve in 2018 for $1.5bn.
Blue Racer’s assets consist of 700 miles (1,127km) of pipelines across Ohio and West Virginia.
Magellan reportedly
seeking Longhorn pipeline
stake sale
Pipeline operator Magellan Midstream Partners is exploring a potential sale of a 35% stake in its 275,000 barrel per day Longhorn crude pipeline in Texas for up to $2bn, Reuters has reported people familiar with the matter as saying.
According to the sources, Magellan is working with investment banks to sell the stake in a new business unit that will contain the Longhorn pipeline and certain storage assets on the US Gulf Coast. e company would continue owning the remaining stake in the pipeline.
e pipeline transports crude from the West Texas portion of the Permian Basin to re neries and export facilities in Houston.
e sources said Magellan was currently marketing the stake to long-term nancial investors such as infrastructure and pension funds. One noted that the nal bids are expected to be lodged in July.
e newly created unit has 12-month earnings before interest, tax, depreciation and amortisation (EBITDA) of $400-500mn, according to the sources.
Magellan did not comment on the
report. However, this is not the rst time the company has sought to sell a stake in one of its existing assets. In August 2018, Magellan and Plains All American Pipeline said they would sell a 50% interest in BridgeTex Pipeline for $1.44bn to the infrastructure arm of Canadian pension fund OMERS.
Summit Midstream Partners makes final investment decision on Double E pipeline project and secures joint venture partner
Summit Midstream Partners (SMLP) announced today a nal investment decision
Week 25 27•June•2019
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