Energy Transfer signs $3.25bn deal to acquire WTG Midstream

Energy Transfer signs .25bn deal to acquire WTG Midstream

Energy Transfer has agreed to acquire WTG Midstream in a deal worth approximately $3.25 billion from Stonepeak subsidiaries Davis Estate and Diamondback Energy.

The transaction price includes a cash payment of $2.45 billion and the issuance of approximately 50.8 million new common units of Energy Transfer to the sellers.

Diamondback Energy, which currently holds a 25% stake in WTG, will receive approximately $375 million once the transaction is completed.

Travis Stice, President and CEO of Diamondback, said: “Not only has our partnership generated an outsized economic return, but WTG’s gas gathering and processing system continues to support Diamondback’s substantial activity on our dedicated permit .

“We are excited to further expand our relationship with Energy Transfer and look forward to a smooth operational transition.”

WTG provides midstream services, including wellhead collection, intra-basin transportation and processing services.

The company, through its 6,000-mile pipeline network, supplies major operators in Martin, Howard, Reagan, Upton and Irion counties in the Midland Basin.

WTG Midstream also operates eight processing plants and is in the process of building two new plants.

Energy Transfer expects WTG’s pipeline network and processing plants to strengthen its access to natural gas and NGL volumes, while strengthening its Permian operations and downstream businesses.

The acquisition also grants Energy Transfer a 20% interest in the BANGL pipeline, improving connectivity between the Permian Basin and Texas Gulf Coast markets.

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

RBC Capital Markets is advising Energy Transfer on the transaction, while Vinson & Elkins is acting as legal advisor.

Jefferies is acting as financial advisor to WTG Midstream on the transaction. Sidley Austin is the legal advisor.

“Energy Transfer Signs $3.25 Billion Deal to Acquire WTG Midstream” was originally created and published by Offshore technologya brand owned by GlobalData.


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