Global Infrastructure Partners (GIP) says that its second fund, Global Infrastructure Partners II, and affiliated funds, have agreed to enter into a strategic joint venture with Hess Corp. (NYSE: HES) through the acquisition of a 50% interest in Hess Infrastructure Partners, the owner of Hess’s midstream crude oil and natural gas infrastructure assets located primarily in the Bakken shale play.
The purchase price for the transaction is $2.675 billion, and it is expected to be financed with a combination of equity and debt. Following the transaction, Hess will retain a 50% interest in Hess Infrastructure and will continue to act as the operator of the assets.
The midstream assets are located primarily in Williams, Mountrail, and McKenzie counties, North Dakota, and comprise crude oil and natural gas gathering systems, a natural gas processing and fractionation facility, crude oil export logistics assets, and an underground propane storage facility, all of which provide services to Hess and its affiliates.
The transaction is expected to close in the third quarter of 2015.