Midstream energy operator Tallgrass Energy Partners has signed an agreement to acquire DCP Midstream’s Douglas natural gas gathering system in the Powder River Basin for approximately $128m.
Encompassing around 1,500 miles of gathering lines across four counties in Wyoming, US, the Douglas gathering system is the primary gathering system for TMID’s Douglas processing plant.
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Tallgrass chief commercial officer Matt Sheehy said: “This is a strategic acquisition that complements our existing assets in the region.
“The Douglas gathering system was originally designed to deliver gas to TMID’s Douglas processing facility but was sold separately 15 years ago.
“We view this recombination as strategically important for our processing activities in the Powder River Basin.”
In another recent development, Tallgrass Energy Partners acquired a water disposal facility in the Powder River Basin through its BNN Water Solutions subsidiary.
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By GlobalDataSheehy further noted: “These two acquisitions are important components in our total basin strategy in the Powder.
“The gathering system, when combined with our Casper and Douglas processing facilities, the residue lines feeding Tallgrass Interstate Gas Transmission, access to our water business services and assets and overall proximity to Pony Express, allows Tallgrass to offer a cost-effective, one-stop-midstream-shop for producers in the Powder River Basin.”
The transaction is subject to the fulfilment of specified closing conditions, including expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
The acquisition is being carried out through its subsidiary Tallgrass Midstream (TMID) and is expected to complete on or before the end of this second quarter.
