US-based Crestwood Midstream Partners has completed the acquisition of a 50% interest in Jackalope Gas Gathering Services from RKI Exploration & Production, for approximately $107.5m.
Access Midstream Partners holds the remaining 50% stake in Jackalope, and will take responsibility for field operations and construction management while Crestwood will handle commercial development.
The Jackalope gathering and processing system is situated in the Powder River Basin Niobrara shale play in Converse County, Wyoming.
The system currently holds around 100 miles of gathering pipelines and 9,400 horsepower of compression equipment. It has mainly been developed to gather and process natural gas produced from a 311,000-acre area of Chesapeake Energy and RKI.
Chesapeake and RKI collectively holds around 750,000 acres in the Powder River Basin Niobrara shale play.
Crestwood general partner chairman, president and CEO Robert G Phillips said that the transaction places the company in the midst of rich gas plays supported by long-term contracts and large acreage dedications.
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By GlobalData"The Jackalope System provides significant visibility to cash flow growth, as midstream infrastructure is expanded to support very capable producers in the Niobrara play," Phillips added.
Crestwood operates fee-based gathering, processing, treating and compression assets, servicing natural gas producers in the north Texas Barnett Shale as well as Marcellus Shale in northern West Virginia and Fayetteville Shale in northwest Arkansas.
Crestwood also operates in Granite Wash in the Texas Panhandle, Avalon Shale or Bone Spring in southeastern New Mexico and Haynesville or Bossier Shale in western Louisiana.
Image: The Jackalope System has about 100 miles of gathering pipelines and 9,400 horsepower of compression equipment. Photo: courtesy of Wilfra.
