Nuevo Midstream Dos (Nuevo Dos) has agreed to acquire Texas-based midstream company Republic Midstream from an affiliate of ArcLight Capital Partners for an undisclosed price.
Image: Republic Midstream to be acquired by Nuevo Dos. Photo courtesy of rawpixel/Pixabay.
Republic Midstream is the owner and operator of a crude oil gathering, storage and a intermediate transportation system located in the DeWitt and Lavaca counties located in the Eagle Ford Shale in Texas.
In July 2014, ArcLight committed an investment of $400m in Republic Midstream to help in the construction of the midstream assets in Eagle Ford Shale.
Currently, the midstream system comprises about 161km of gathering pipeline that feeds a central delivery point (CDP) with 300,000 barrels of crude oil storage. The infrastructure also includes a six-bay truck station.
The 42km long intermediate pipeline owned by Republic Midstream transports volumes from the CDP to the Kinder Morgan Crude and Condensate Pipeline (KMCC) and the Enterprise owned and operated Eagle Ford Crude Oil Pipeline System.
The Kinder Morgan and Enterprise pipelines transport crude and condensate to various terminals that have access to petrochemical plants, refineries and export terminals located along the Texas Gulf Coast.
Nuevo Dos revealed its plans to expand Republic Midstream’s infrastructure.
Nuevo Dos president and CEO Randy Ziebarth said: “We are very excited about this acquisition and the opportunity to expand the footprint and service offerings of the Republic system. We really like these assets and their location within the Eagle Ford.
“The Eagle Ford is experiencing a resurgence and is advantaged by its proximity to the Gulf. Nuevo Dos looks forward to helping producers fully participate in moving crude and condensate to market.”
The acquisition is expected to be completed in the second quarter of this year.
Established in 2015, the Texas-based Nuevo Dos was formed by Nuevo Midstream’s leadership team after the company’s $1.5bn sale to Western Gas Partners in October 2014.
Nuevo Dos, which is backed by a $400m initial capital commitment from EnCap Flatrock Midstream, is engaged in pursuing organic and strategic acquisition opportunities in North America.
EnCap Flatrock vice president and Nuevo Dos board of directors member Zach Kayem said: “We have been partnering with the Nuevo team since 2011.
“This is a team with a very successful track record of acquiring a system and developing its potential, as it did in the Permian. We’re looking forward to assisting the Nuevo Dos team with the acquisition and expansion of Republic’s Eagle Ford system.”