Another Permian merger

Energy Transfer in US$3.25 billion deal

Energy Transfer will acquire WTG Midstream Holdings LLC in a transaction valued at approximately US$3.25 billion from affiliates of Stonepeak, the Davis Estate and Diamondback Energy.

The transaction is expected to close in the third quarter of 2024, subject to regulatory approval and customary closing conditions.

WTG provides comprehensive midstream services including wellhead gathering, intra-basin transportation and processing services. The company’s 6,000-mile pipeline network serves significant operators in some of the most active areas of the Midland Basin including Martin, Howard, Upton, Reagan and Irion counties. WTG also operates eight processing plants with a total capacity of approximately 1.3 Bcf/d and is constructing two new plants with an additional capacity of approximately 0.4 Bcf/d. The first new plant is expected to be in service in the third quarter of 2024 and the second plant the third quarter of 2025.

The addition of WTG assets is expected to provide Energy Transfer with increased access to growing supplies of natural gas and NGL volumes enhancing the partnership’s Permian operations and downstream businesses.

The acquisition also includes a 20% interest in BANGL Pipeline, an approximately 425-mile NGL pipeline with an initial capacity of 125,000 Bbls/d (expandable up over 300,000 Bbls/d) connecting the Permian Basin to markets on the Texas Gulf Coast. Energy Transfer benefits from well positioned assets in the Permian which is the most active region in the U.S. and this acquisition is expected to provide future upside as the basin continues to develop on and around Energy Transfer’s infrastructure.

Energy Transfer owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with more than 125,000 miles of pipeline and associated energy infrastructure. Energy Transfer’s strategic network spans 44 states with assets in all of the major U.S. production basins. WTG Midstream is a privately held midstream company headquartered in Midland, Texas, with operations primarily located in the Midland Basin of the Permian Basin. WTG specializes in gas gathering, compression, treating and processing solutions that are tailored to our customers’ needs.

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