Crestwood Announces Closing of the Contribution of Willow Lake Assets to Delaware Basin Joint Venture with First Reserve
June 21 2017 - 9:00AM
Business Wire
Crestwood Equity Partners LP (NYSE: CEQP) (“Crestwood Equity” or
“Crestwood”) and First Reserve today announced that Crestwood
Permian Basin Holdings LLC (“CPJV” or the “Joint Venture”), a joint
venture focused on developing, owning and operating midstream
infrastructure in the Delaware Basin, has completed the acquisition
of Crestwood’s Willow Lake gathering and processing assets located
in Eddy County, New Mexico. The Joint Venture now owns all of
Crestwood’s Delaware Basin assets. The Joint Venture will continue
to be owned 50% by Crestwood and 50% by First Reserve, a leading
global private equity investment firm exclusively focused on
energy.
As previously announced, CPJV will build a 200 million cubic
feet per day (“MMcf/d”) cryogenic gas processing plant located in
Reeves County, TX (the “Orla Plant”) and related infrastructure
required to connect the Willow Lake system to the plant (the “Orla
Express Pipeline”) and multiple third-party pipelines. Under the
terms of the transaction, Crestwood contributed its Willow Lake
gathering and processing assets to the Joint Venture at a value of
$151 million, and this value will be credited as part of
Crestwood’s capital requirements to the expansion projects.
As previously announced, the initial project scope for the CPJV
expansion projects will include the Orla Express Pipeline, a 33
mile, 20 inch high pressure line connecting the existing Willow
Lake gathering system in Eddy County, NM to the Orla plant. The
Orla plant will offer full liquids handling and multiple residue
and NGL interconnects. Initial project capital is expected to be
approximately $170 million and the project is expected to be placed
into service in the second half of 2018.
The Orla Plant is supported by current dedications from existing
Willow Lake customers and is strategically located to attract
processing volumes in Eddy County, NM as well as areas around the
Orla Express Pipeline and the Nautilus system. The Nautilus system
is a newly-built gas gathering system serving a subsidiary of Royal
Dutch Shell (SWEPI) in Loving and Ward counties, Texas. The Orla
Plant will provide needed incremental processing capacity and
enhanced netbacks to producers through improved connectivity to the
best NGL and residue gas takeaway options out of the basin. Once
the Orla plant is placed into service, the Joint Venture’s asset
footprint will include over 200,000 acres of dedication, 285 MMcf/d
of processing capacity, 300 MMcf/d of gathering capacity, and over
360 miles of pipe.
About First Reserve
First Reserve is a leading global private equity investment firm
exclusively focused on energy. With nearly 35 years of industry
insight, investment expertise and operational excellence, the Firm
has cultivated an enduring network of global relationships and
raised approximately USD $31 billion of aggregate capital since
inception. First Reserve has completed over 600 transactions
(including platform investments and add-on acquisitions), creating
several notable energy companies throughout the Firm’s history. Its
portfolio companies operate on six continents, spanning the energy
spectrum from upstream oil and gas to midstream and downstream,
including resources, equipment and services, and associated
infrastructure. Visit us at www.firstreserve.com for more
information.
About Crestwood Equity Partners LP
Houston, Texas, based Crestwood Equity Partners LP (NYSE: CEQP)
is a master limited partnership that owns and operates midstream
businesses in multiple unconventional shale resource plays across
the United States. Crestwood Equity is engaged in the gathering,
processing, treating, compression, storage and transportation of
natural gas; storage, transportation, terminalling, and marketing
of NGLs; and gathering, storage, terminalling and marketing of
crude oil.
Forward-Looking Statements
This news release contains forward-looking statements within the
meaning of the U.S. Private Securities Litigation Reform Act of
1995 and Section 21E of the Securities and Exchange Act of 1934.
The words “expects,” “believes,” anticipates,” “plans,” “will,”
“shall,” “estimates,” and similar expressions identify
forward-looking statements, which are generally not historical in
nature. Forward-looking statements are subject to risks and
uncertainties and are based on the beliefs and assumptions of
management, based on information currently available to them.
Although Crestwood believes that these forward-looking statements
are based on reasonable assumptions, it can give no assurance that
any such forward-looking statements will materialize. Important
factors that could cause actual results to differ materially from
those expressed in or implied from these forward-looking statements
include the risks and uncertainties described in Crestwood’s
reports filed with the Securities and Exchange Commission,
including its Annual Report on Form 10-K and its subsequent
reports, which are available through the SEC’s EDGAR system at
www.sec.gov and on our website. Readers are cautioned not to place
undue reliance on forward-looking statements, which reflect
management’s view only as of the date made, and Crestwood assumes
no obligation to update these forward-looking statements.
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version on businesswire.com: http://www.businesswire.com/news/home/20170621005423/en/
Crestwood Equity Partners LPInvestor ContactJosh
Wannarka, 713-380-3081Vice President, Investor
Relationsjosh.wannarka@crestwoodlp.comorFirst
ReserveMedia ContactJoele Frank, Wilkinson Brimmer
KatcherJonathan Keehner / Julie Oakes,
212-355-4449joakes@joelefrank.com
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