ONEOK pays $5.9B for Permian assets
August 30, 2024
ONEOK Inc., has agreed to acquire Medallion Midstream and controlling interest in EnLink Midstream from Global Infrastructure Partners, the company announced late Wednesday.
A leading midstream service provider with a big presence in Mont Belvieu, ONEOK connects natural gas liquids (NGL) supply with key market centers and an extensive network of natural gas gathering, processing, storage and transportation assets.
The Tulsa, Oklahoma-based company agreed in separate agreements to pay $5.9 billion to purchase Medallion Midstream LLC and controlling interest in EnLink Midstream LLC to establish a fully integrated Permian Basin platform at scale, the company said.
“ONEOK has a longstanding reputation as being intentional in building a premier energy infrastructure company, and today’s transactions further solidify that status by adding complementary assets that allow us to continue expanding and extending our value chain,” said Pierce H. Norton II, ONEOK president and chief executive officer.
“We are particularly excited to meaningfully increase our company’s presence in the Permian Basin, which is expected to continue driving the majority of U.S. oil and gas growth.”
The transactions include 1.7 billion cubic feet per day of Permian gas processing capacity and 1.6 million barrels per day of Permian crude gathering capacity.
The EnLink assets enhance ONEOK’s existing integrated natural gas and NGL platform in Oklahoma and provide ONEOK with natural gas gathering and processing operations in North Texas that produce solid cash flows and are directly connected to Mont Belvieu by ONEOK’s NGL pipelines.
EnLink also provides ONEOK with a new position in Louisiana that includes 220 thousand barrels per day of NGL fractionation capacity and approximately 4 billion cubic feet per day of natural gas pipeline capacity, both of which are connected to key demand centers.
The transaction is expected to close – subject to customary closing conditions – early in the fourth quarter of 2024. After the closing of the purchase of GIP’s interests in EnLink, ONEOK intends to pursue a tax-free acquisition of the publicly held interests in EnLink. The company will maintain its headquarters in Tulsa, Oklahoma, and intends to retain meaningful presences in the Houston and Dallas metropolitan areas.