NGL Energy Partners has acquired Coastal Plains #1, LLC, a subsidiary of WinCo Development, for $109.5 million in cash and approximately $6.8 million in stock (~$116 million total). The water disposal facilities will be added to NGL Energy partner's existing business in the area - High Sierra Water-Eagle Ford, LLC.
The deal adds three water disposal facilities to High Sierra's existing water gathering and treatment portfolio. The deal includes the option to acquire two permits and a fourth water disposal facility that is under construction. Costal Plains #1's 40 employees will now work for High Sierra Water.
“With the addition of the Coastal Plains assets and employees, NGL is uniquely positioned to serve the needs of producers in the Eagle Ford through our High Sierra business. We are also looking forward to applying our extensive technical expertise in water treatment as demand for the recycling of oilfield waste water increases.”
High Sierra's Eagle Ford footprint includes 240,000 b/d of water disposal capacity, water & crude oil transportation assets, a crude oil marketing segment, and mobile on-site solids processing equipment.
The deal follows NGL Energy's Acquisition of Crescent Terminals and Cierra Marine in July.
NGL Energy's business segments provide crude oil logistics, NGL logistics, and water treatment services in the Gulf Coast region. Overall, High Sierra expects the assets improve their operations in many ways.
The company's VP of investor relations stated:
"We are now able to offer reliable, high quality and safe disposal services to producers operating throughout the region. Having multiple large capacity facilities allows us to balance utilization, reducing wait times, trucking miles and ultimately costs. In addition, we are evaluating a number of projects to bring our industry leading recycling technology to the play."