In the water asset deal, WaterBridge gains 82 miles of water pipeline and seven disposal wells from PDC, according to a statement from WaterBridge. The Permian Basin pipeline has a capacity of 180,000 b/d and stretches though Reeves and Culberson counties in West Texas, overlying the southern Delaware sub-basin.
WaterBridge closed the purchase for $125 million, with conditional payments of up to $75 million, according to a PDC filing with the Securities and Exchange Commission.
Part of the deal includes an agreement in which WaterBridge would manage, recycle and supply water to PDC in the producer’s operated acreage.
PDC also has completed the sale of midstream gas assets in the Delaware to EagleClaw Midstream Ventures LLC for $100 million and an unconditional cash payment of $82 million within one year of closing. That deal includes production targets that could result in an additional $60 million if PDC exceeds those targets, as well as long-term flow assurances from EagleClaw.
In addition, PDC completed the sale of crude midstream assets to Oryx Southern Delaware Oil Gathering and Transport LLC (ODOC) for $37.3 million and conditional cash payments of up to $15.2 million.
ODOC recently closed an open season to gauge support for transportation on its regional system serving the Delaware sub-basin, with multiple route options.
The WaterBridge deal is the largest, highlighting opportunities for midstream companies in water management among oil and gas producers in major oil and gas producing regions. WaterBridge last year also agreed to purchase nine saltwater disposal wells near Pecos, TX, in southern Reeves and Ward counties from NGL Energy Partners LP.
Oilfield waste disposal firm Milestone Environmental Services recently acquired leases and injection permits in Howard County, TX, giving the company an additional 150,000 b/d of permitted injection wastewater capacity in the Permian.
Tallgrass Energy LP, the operator of the Rockies Express pipeline, has also expanded its stronghold in water management and infrastructure, with acquisitions over the past eight months that expands its water assets in the Bakken Shale and in Appalachia.