Enterprise Products Partners LP (NYSE: EPD) has executed definitive agreements to purchase all of the member interests in EFS Midstream LLC from affiliates of Pioneer Natural Resources Co. and Reliance Industries Ltd. for $2.15 billion.
The purchase price will be paid in two installments with the first installment of $1.15 billion paid at closing and the final installment of $1 billion paid no later than the first anniversary of the closing date.
EFS Midstream provides gas gathering, treating, compression and condensate processing services in the Eagle Ford shale play. The EFS Midstream system includes 460 miles of natural gas gathering pipelines, 10 central gathering plants, 780 million cubic feet per day of natural gas treating capacity, and 119 thousand barrels per day of condensate stabilization capacity. Under the terms of the agreements, the Pioneer and Reliance joint development will dedicate its Eagle Ford shale acreage to Enterprise under a 20-year, fixed-fee gathering agreement that includes a minimum volume requirement for the first seven years.
Pioneer and Reliance will also dedicate their Eagle Ford shale acreage under related 20-year fee-based agreements with Enterprise for natural gas processing, natural gas liquids transportation and fractionation, and for natural gas, processed condensate, and crude oil transportation services.
The transaction is expected to close in the third quarter of 2015.