Park Energy Services, a portfolio company of Rock Hill Capital, has completed the acquisition of Midcon Compression, a division of Chesapeake Energy Corporation.
The transaction includes a facility in Hinton, Oklahoma, and a fleet of natural gas compressors used mainly in artificial lift, wellhead compression, and gathering applications.
All Midcon personnel will join the Park team.
The acquisition will increase Park’s total compression fleet to more than 150,000 hp while expanding the company’s position in the Midcontinent and South Texas regions.
The fleet consists primarily of three-stage, high-pressure gas lift compressors, which will enable Park to take advantage of the demand for gas lift compression with new and existing customers.
Park has also entered into a multi-year agreement with Chesapeake, under which it will serve as a strategic local compression provider, while allowing Chesapeake to unlock value by shedding ancillary assets.
Park president and CEO Jonathan Mitchell said: “We are excited to announce the closing of our acquisition of Midcon Compression and for the opportunity to partner with Chesapeake.
“This acquisition expands Park’s rental and service offering with the addition of high-quality compressor assets and talented personnel strategically positioned around our existing footprint.”
Park Energy Services, founded in 2014, specializes in compressor technology for oil and natural gas producers to increase well production volume and simultaneously reduce emissions and comply with environmental rules and regulations.
Mitchell said: “Our units are capturing gas that would otherwise be burned or vented and putting that gas on the sale line.”
He said that the company’s expanded rental and service offerings could help companies such as Chesapeake focus on developing core assets.
Mitchell said: “By letting us provide the compression services and equipment, these companies are saving themselves from the expense of managing and maintaining a serviceable fleet.
“That frees them up to invest in and develop their core, profit-making assets. It’s a win-win scenario for Park and our customers.”
Regions Bank and BMO Harris Bank provided debt financing and Winston & Strawn provided legal representation services for the transaction.