Denver-based ARB Midstream LLC said it has partnered with Vitol US Holding Co. to acquire the crude oil Red River Gathering System, which serves the Midcontinent and the Barnett Shale, and has rebranded the acquisition as the Texoma Crude Oil Pipeline System.
Financial terms of the deal were not disclosed. ARB said Texoma serves the core of the SCOOP (aka the South Central Oklahoma Oil Province) play, as well as portions of the STACK (aka the Sooner Trend of the Anadarko Basin, mostly in Canadian and Kingfisher counties) play and the Barnett. The system includes 700 miles of active crude oil pipelines, more than 950,000 bbl of working storage and 25 truck injection stations across North Texas and Southern Oklahoma.
The acquisition gives ARB, which claims to be the largest privately-held crude oil midstream gatherer in the Denver-Julesburg (DJ) Basin, exposure to the SCOOP and STACK plays. CFO Rogan McGillis told NGI's Shale Daily on Tuesday that the acquired assets, coupled with an additional 100 miles of pipeline not currently in service, would comprise Texoma Crude Oil Pipeline Co. LLC, a new subsidiary for the company. ARB's subsidiary in the DJ Basin is Platte River Midstream LLC.
"This acquisition enhances ARB's position within the U.S. inland corridor and provides the company with exposure to multiple growing shale regions," said CEO Adam Bedard.
ARB's Pat McMurry, senior vice president for gathering and transportation, added that there were "numerous opportunities to expand the capabilities and connectivity of the Texoma system, since it is connected to three of the most dynamic markets in the U.S. -- Midland, Cushing, and the Gulf Coast -- providing producers and refiners access to multiple markets at any time." McMurry was responsible for managing the Red River system for its previous owner.
Vitol's parent company, Switzerland's Vitol Inc., is the world's largest oil trader and one of its largest energy traders. Last month, it agreed to a 15-year contract for up to 800,000 metric tons/year (mty) of liquefied natural gas (LNG) through the LNG Canada project. That agreement followed a separate 15-year deal to acquire 70,000 mty of LNG from Houston-based Cheniere Energy Inc. in September.