LM Energy Holdings LLC is aiming to sell parts of its crude oil gathering business in the New Mexico portion of the Permian Basin to help fuel a focus shift to natural gas.

The Dallas-based midstreamer disclosed it has entered into agreements to sell assets and subsidiaries of its Touchdown crude oil gathering system in New Mexico’s Eddy and Lea counties. Touchdown consists of more than 130 miles of pipeline and 136,000 barrels of combined storage capacity in the Permian Basin’s Delaware sub-basin.

Buyers and financial details of the agreements weren’t disclosed. Transactions are anticipated to close by December.

LM Energy CEO Elliot Gerson said the pivot would help make LM Energy “a stronger and even better capitalized company” as it builds up its gas business in...