SandRidge’s $126-million midstream purchase

USA

OKLAHOMA CITY, October 6, 2015 – US oil and gas company SandRidge announced on Monday that it has agreed purchase midstream business the Pinon Gathering Company for $126 million.

SandRidge will pay $48 million upfront and $78 million of its secured notes to finance the deal.

“By eliminating payments related to contractual volume commitments, this transaction will immediately increase annual EBITDA by approximately $40 million,” James Bennet, president and CEO of Ridge Energy, said in a company release on Monday.

The Pinon Gathering Company has more than 915 kilometres of gathering lines for natural gas production, which will help supplement SandRidge’s Pinon assets in West Texas.

SandRidge will complete its midstream purchase from private equity firm EIG Global Energy Partners. The deal is expected to close by the end of 2015.

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