Dallas, Texas – Energy Transfer, a Dallas-based leader in the natural gas industry, disclosed plans on Wednesday to consolidate with Houston’s Crestwood Equity Partners, a deal estimated to be worth around $7.1 billion.
Energy Transfer and Crestwood Equity Partners merger should be finished later this year
The transaction, expected to close in late 2023, is contingent upon regulatory approval, as well as the endorsement of Crestwood shareholders. As part of the arrangement, Energy Transfer will assume $3.3 billion of Crestwood’s debt, the company revealed in a press statement.
Energy Transfer’s acquisition of Crestwood encompasses the latter’s gathering and processing assets located in West Texas, Wyoming, and the Dakotas. Crestwood’s assets notably include an impressive 3.4 billion cubic feet per day of gas processing capacity and a 340 thousand barrels a day of crude gathering capacity.
The acquisition is also poised to augment Energy Transfer’s portfolio with terminal and storage assets. It is anticipated that the merger will yield an additional 10 million barrels of storage capacity for Energy Transfer, further bolstered by the inclusion of trucking and rail terminals.
All shareholders would benefit with the Energy Transfer and Crestwood Equity Partners merger
In a presentation to investors, Energy Transfer asserted that the merger would result in benefits accruing to all shareholders due to the increased scale and integration of the acquisition.
“CEQP’s substantial processing capacity in the Williston and Delaware basins complements ET’s significant downstream fractionation capacity at Mont Belvieu and hydrocarbon export capability from both Nederland, Texas and the Marcus Hook complex in Philadelphia, Pennsylvania,” Energy Transfer said in the presentation.
Kelcy Warren, the Dallas billionaire at the helm of Energy Transfer as executive chairman, has overseen a history of acquisitions and mergers during his tenure. His tenure has witnessed the absorption of Transwestern Pipeline in 2006, Sunoco in 2012, and, more recently, Lotus Midstream earlier this year. The company has under its purview one of the most substantial energy asset portfolios in the US, comprising nearly 125,000 miles of pipeline and affiliated infrastructure.
The Energy Transfer and Crestwood Equity Partners merger confirmation comes soon after H Mart announced investing in Fort Worth and NexMetro plans for further investments in North Texas.