Apollo Buys El Paso’s E&P Unit Before Kinder Morgan Closes on the Pipeline Segment

El Paso Eagle Ford Shale Map

El Paso Eagle Ford Map | Click to Enlarge

Apollo and El Paso reached a $7.15 billion agreement for El Paso’s E&P segment. The deal is subject to the closing of the El Paso-Kinder Morgan pipeline merger.

El Paso’s exploration and production segment has been on the sales block since the Kinder Morgan deal was announced, but the question remained whether the assets would be sold in pieces or all together.

While Apollo has been rumored to be considering the deal, it comes as a bit of a surprise that the private equity group acquire El Paso E&P. Most industry experts thought El Paso would be a great fit for an international company looking to expand its footprint in the U.S. (e.g. Statoil-Brigham). Low natural gas prices that are limiting many companies’ upstream budgets might have opened a window for the Apollo group to step in. [Read more…]

El Paso Corp’s Gathering System Expands to Allow Production Growth – Q3 Ops

El Paso Corporation¬†recently announced it will be acquired by Kinder Morgan. That means El Paso’s Eagle Ford assets might be on the market soon. In the mean time, the company reported results from the third quarter of 2011.

The addition of a gathering system in the area will alleviate constraints and forth quarter production is expected to jump to 17,500 boe/d gross from 10,500 boe/d gross in Q3. The midstream group’s gathering system will have capacity for 150 mmcfd and 80,000 bbls/d by year-end 2011.¬† [Read more…]