Silver Creek Midstream through one of its affiliates has wrapped up the acquisition of Genesis Energy’s midstream assets in the Powder River Basin in the US for a sum of around $300m.
The Powder River Basin midstream assets acquired by Silver Creek in the all-cash deal include the Powder River Basin Pipeline and the associated crude oil gathering system and rail facility. The deal was announced in August 2018.
Silver Creek, in conjunction with the deal, has secured an equity commitment of $600m from a newly formed joint venture between Tailwater Capital and The Energy & Minerals Group (EMG).
The new capital has been allocated for the closing of the deal with Genesis Energy and also for pursuing identified projects to expand the Trunkline System to cope up with the increasing demand for crude oil midstream services in the Powder River Basin.
Silver Creek founder and CEO Patrick Barley said: “We are excited to expand our presence in the Powder River Basin with the acquisition of the existing Genesis crude oil assets.
“The existing Genesis Gathering System and Intrastate Pipeline combined with our new growth projects will give Silver Creek the ability to offer a comprehensive crude midstream solution across Converse, Campbell, Johnson and Natrona counties.”
The acquisition has taken the existing Powder River Basin footprint of Silver Creek to 305km of crude trunkline and gathering pipelines to go along with nearly more than 190,000 barrels per day of initial pipeline capacity from the Silver Creek Pronghorn Terminal to the Guernsey Hub. The pipeline capacity can be expanded to more than 325,000 barrels per day, said Silver Creek.
The acquisition has also given three significant existing interconnections to downstream markets out of Guernsey along with more than 1.1 million barrels of crude storage with an additional 800,000 barrels permitted.
Tailwater Capital managing partner Jason Downie said: “Tailwater has been supporting Silver Creek since inception, and we could not be happier with the progress they have made in Wyoming.
“We are looking forward to supporting Patrick and his team as they provide creative crude gathering and takeaway solutions for producers in this growing basin.”