Monday, September 8, 2014
Ferrellgas Partners LP (Overland Park, Kan.) said Sept. 2 it had entered into an agreement to acquire two saltwater disposal (SWD) wells in the Eagle Ford Shale region of South Texas from C&E Production LLC (C&E; Bryan, Texas) and its affiliates. The acquisition will increase Ferrellgas’ SWD wells in the region to eight.
The Ferrellgas midstream division was established in May with the acquisition of Sable Environmental LLC. The C&E assets will be managed with other existing SWD facilities under the Sable platform, increasing the daily operational permitted capacity 33% to 180,000 bbl. In addition, Ferrellgas will have the contractual right to acquire additional SWD wells from C&E affiliates in the region.
“As we continue our diversification strategy, we are thrilled to have identified a number of attractive midstream opportunities that have advanced our efforts in the growth of our organization,” said Ryan VanWinkle, vice president and CFO of Ferrellgas Partners. “This acquisition expands our midstream platform in the region, adding both capacity and new energy producers as customers to the collective assets.”
Associated with the transaction, equity holders of the C&E SWD assets will acquire $12 million of Ferrellgas common units. Ferrell Cos. Inc., the parent company of the partnership’s general partner, will also acquire $30 million of Ferrellgas common units. Proceeds from the offerings will be used to finance the transaction, as well as other recent growth initiatives.
The Ferrellgas midstream division was established in May with the acquisition of Sable Environmental LLC. The C&E assets will be managed with other existing SWD facilities under the Sable platform, increasing the daily operational permitted capacity 33% to 180,000 bbl. In addition, Ferrellgas will have the contractual right to acquire additional SWD wells from C&E affiliates in the region.
“As we continue our diversification strategy, we are thrilled to have identified a number of attractive midstream opportunities that have advanced our efforts in the growth of our organization,” said Ryan VanWinkle, vice president and CFO of Ferrellgas Partners. “This acquisition expands our midstream platform in the region, adding both capacity and new energy producers as customers to the collective assets.”
Associated with the transaction, equity holders of the C&E SWD assets will acquire $12 million of Ferrellgas common units. Ferrell Cos. Inc., the parent company of the partnership’s general partner, will also acquire $30 million of Ferrellgas common units. Proceeds from the offerings will be used to finance the transaction, as well as other recent growth initiatives.
