Crestwood Midstream Partners LP has agreed to acquire privately held Arrow Midstream Holdings LLC for approximately US$ 750 million. The deal is expected to expand Crestwood's operational footprint in North America鈥檚 fast developing Bakken Shale field, tapping into the increasing demand for pipeline and storage service in the area.
Arrow Midstream Holdings
Arrow owns and operates crude oil, natural gas and water gathering systems in the Fort Berthold Indian Reservation in the core of the Bakken shale, McKenzie and Dunn counties, North Dakota. Arrow鈥檚 assets have drawn fixed-fee contracts from producers drilling on more than 150 000 net acres in the Bakken.
The Arrow system consists of more than 460 m of pipeline. This includes 150 m of crude oil gathering pipeline, 160 m of gas gathering pipeline and 150 m of water gathering lines. Current volumes on the system are roughly 50 000 bpd crude oil, 15 mmcfd natural gas and 8500 bpd water. Over the next 18-24 months, the company expects to reach targeted operational capacities of 125 000 bpd of crude, 100 mmcfd of gas and 40 000 bpd of water.
The acquired assets also include a 23 acre central delivery point with multiple pipeline take-away outlets and a fully automated truck loading terminal.
Crestwood鈥檚 future growth
Crestwood Chief Executive, Robert Phillips, said the Bakken Shale is a core area for the company's future growth and, after the close of the acquisition, will be one of the largest Bakken midstream service providers servicing about 18% of current total Bakken crude oil production.
Phillips said that the deal falls in line with Crestwood鈥檚 goal to 鈥渁ggressively commercially develop and look for bold-on opportunities.鈥� He added, 鈥淲e want to focus on and invest in projects with great visibility to growth, and this one clearly does.鈥�
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