Targa Resources Corp. has agreed to purchase Blackstone Energy Partners’ 25% interest in Targa’s Grand Prix natural gas liquids (NGL) pipeline for $1.05 billion in cash plus customary working capital adjustments.

The transaction, slated to close during the first quarter, would give Houston-based Targa a 100% ownership position in the 1.0 million b/d capacity pipeline.

Grand Prix connects Targa’s gathering and processing positions throughout the Permian Basin, North Texas and Southern Oklahoma, as well as third-party positions, to Targa’s fractionation and storage complex at the Mont Belvieu, TX, hub.

“The performance of our Grand Prix NGL Pipeline has exceeded expectations since it began full operations in the third quarter of 2019, integrating our leading NGL supply aggregation position in the Permian Basin to key demand markets in Mont Belvieu and along the U.S. Gulf Coast,” said Targa CEO Matt Meloy. “Our business has strong momentum for 2023 and this acquisition further simplifies Targa while also increasing our fee-based margin and providing additional cash flow stability.”

The acquisition “further supports our already strong cash flow profile and ability over time to return an increasing amount of capital to our shareholders through common dividend increases and common share repurchases,” Meloy added.

Targa posted record volumes across its gathering and processing assets during the third quarter, and sanctioned a 275 MMcf/d natural gas processing plant in the Permian Basin’s Delaware sub-basin slated to enter service in 1Q2024.

Targa in June also announced a $3.5 billion deal to acquire Lucid Energy Group’s Permian Delaware gas processing business, adding 1,050 miles of pipeline and 1.4 Bcf/d of capacity.

The Permian has been the primary driver of surging U.S. NGL production since 2021.