NGL Energy Partners LP based in Tulsa has made a nearly $239 million sale of some of its saltwater disposal operations in West Texas.
The company said the South Pecos Water Disposal Assets are being sold to a subsidiary of WaterBridge Resources LLC for $238.8 million in cash. The sale includes nine saltwater disposal facilities in southern Reeves and Ward Counties which are near Fort Stockton in far West Texas.
NGL intends to use the proceeds to reduce outstanding indebtedness, improve compliance leverage and enhance liquidity. Leadership indicated it now intends to focus on its substantial Delaware Basin Water Disposal operations in northern Reeves, Loving and Winkler counties in Texas as well as those in southern Eddy and Lea counties in New Mexico.
NGL recently acquired a large land position in the region and developed more disposal facilities and significant pipeline infrastructure.
“The focus of our Delaware Basin Water Solutions strategy has been centered around our consolidated and growing position in central Reeves County, north to the Texas / New Mexico state line and up into Lea and Eddy County, “said Mike Krimbill, NGL’s CEO.
“We will continue to have over 1.0 million barrels per day of permitted disposal capacity in the Delaware Basin following this transaction, with substantial land positions and multiple pipeline projects. This transaction allows NGL to focus more fully on this core area of growth and high return opportunities while helping to also achieve our goals of a “self-funding” model and reducing overall leverage.”
. All of the assets contemplated under this transaction are located near the town of Pecos, Texas in southern Reeves and Ward counties.