Coronado operates three cryogenic gas processing plants and a gas-gathering system in the North Midland basin including 270 miles of gathering pipelines, 175 MMcfd of processing capacity, and 35,000 hp of compression. Construction of an additional 100 MMcfd of processing capacity and gathering system expansions of the Coronado system are under way.
Coronado’s key assets have been constructed in the past 5 years and the system has current inlet volumes of 100 MMcfd. EnLink says it plans to connect the Coronado system with its Bearkat system to create a multicounty rich gas gathering and processing system (OGJ Online, Sept. 24, 2014).
The Coronado system is underpinned by long-term contracts, which include the dedication of production from more than 190,000 acres. Coronado’s key producer customers include Reliance Energy Inc., Diamondback Energy Inc., and RSP Permian Inc. Reliance is the largest owner of Coronado, with affiliates of both Diamondback and RSP Permian owning the remainder.
The owners of Coronado will receive $240 million in cash, $180 million of partnership common units, and $180 million of a new class of Partnership common units, subject to certain adjustments.
“In just over 4 months, we have announced approximately $1 billion of acquisitions, which is consistent with our growth strategy to expand our platform in key producing areas,” said Barry E. Davis, EnLink president and chief executive officer.
Enlink in January agreed to buy LPC Crude Oil Marketing LLC, which has crude oil gathering, transportation, and marketing operations in the Permian, for $100 million (OGJ Online, Jan. 13, 2015). In September, the company agreed to acquire Gulf Coast gas pipeline assets, including the Bridgeline system predominantly residing in southern Louisiana, from Chevron Pipe Line Co. and Chevron Midstream Pipelines LLC for $235 million (OGJ Online, Sept. 29, 2014).
“EnLink is a strong vehicle for sustainable growth, due in large part to our current financial position, which allows us to effectively expand in times like these,” Davis said.