Fort Worth-based Brazos Midstream Holdings LLC on Oot. 10 announced that subsidiaries of the company have closed on the purchase of a natural gas gathering system from Callon Petroleum Company.
As part of the acquisition, Brazos signed a long-term, fee-based agreement with Callon for gas gathering and processing services for acreage under development in Ward and Pecoscounties, one of the premier areas of the Southern Delaware Basin. Including the Callon dedication, Brazos’ midstream infrastructure is anchored by long-term acreage dedications covering approximately 240,000 acres with top-tier Permian operators, according to the company. No price for the transaction was released.
“The acquisition of these strategic assets builds upon our existing franchise position and provides a platform for growth in an area we know well,” said Stephen Luskey, chief commercial officer of Brazos. “Callon is one of the leading pure-play Permian operators and we are pleased to be able to manage their gas infrastructure needs. We look forward to a long-term partnership with Callon and other producers as we grow in one of the most promising regions in our industry.”
The strategic acquisition positions Brazos as one of the largest private natural gas and crude oil midstream companies in the Delaware Basin. The acquired natural gas gathering system will connect to Brazos’ existing system and the previously announced Comanche II natural gas processing plant. When complete in January 2018, Brazos’ total operated processing capacity will be 260 MMcf/d. In addition, Brazos is accelerating plans to build a third natural gas processing plant, Comanche III, to meet continued volume growth in the region. The Company has secured a site for the plant and will begin construction in early 2018.