WPX Energy in Permian basin JV

TULSA, June 14, 2017 – US oil and natural gas producer WPX Energy announced on Tuesday that it will be partnering with Howard Energy Partners to develop oil gathering and natural gas processing infrastructure in the Stateline area of the Permian’s Delaware basin.

The partners intend to complete construction of a new crude oil gathering system and a planned natural gas processing complex in the basin. The agreement will support WPX’s drilling operations in the Stateline area, which currently represent 202 net square kilometres.

Under the terms of the joint venture agreement, WPX Energy will receive USD 300 million upfront from San Antonio-based Howard Energy Partners. The latter will also fund the first USD 263 million of the JV’s capital expenditures.

Based on the cash to WPX, the capital carry and WPX’s ownership interest, the transaction implies a value of USD 863 million for Stateline oil gathering and gas processing projects. The deal is expected to close in the third quarter.

Howard Energy Partners is a midstream provider that operates natural gas gathering and transportation pipelines and natural gas liquids processing plants in South Texas and Pennsylvania.

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