PE Tech Report

NEWSLETTER

Like this article?

Sign up to our free newsletter

WaterBridge acquires Centennial Resource Development’s Southern Delaware produced water infrastructure

WaterBridge Holdings is to acquire the Southern Delaware Basin produced water infrastructure of Centennial Resource Production, LLC, a subsidiary of Centennial Resource Development (Centennial).  Contemporaneous with closing, WaterBridge and Centennial will enter into a 15-year produced water management agreement at market rates for Centennial’s operated acreage within an extensive area of mutual interest.  The transaction is valued at USD225 million, consisting of USD150 million in upfront cash and an additional USD75 million payable to Centennial over a three-year period based on Centennial achieving certain incentive thresholds.  The transaction is subject to certain regulatory approvals and other customary closing conditions, and is expected to close in March 2020.

Upon closing of this transaction, WaterBridge will have over 600,000 acres operated by over 23 blue-chip producers under long-term dedication in the Southern Delaware Basin. WaterBridge’s extensive integrated water infrastructure network provides nearly two million bpd of water handling capacity via 1,140 miles of large-diameter pipelines and 87 handling facilities.

David Capobianco, CEO of Five Point Energy and Chairman of the Board of WaterBridge, says: “In 2016, Five Point Energy funded the formation of WaterBridge with a well-defined strategy of being a first mover in progressively addressing the produced water needs of the Permian Basin.  With the addition of Centennial’s produced water handling assets to WaterBridge’s network, the company has expanded the capabilities of its system and firmly established itself as the largest pure play water midstream company in the industry. 

“The capacity and redundancy offered by our systems will continue to be instrumental in supporting current and future customers’ development programs in the Southern Delaware Basin.”

Jason Long, Co-President and COO of WaterBridge, says: “Today’s announced transaction represents another key milestone for WaterBridge, further validating our unique value proposition and industry leading platform.  Centennial has been an important partner to us from the very beginning and is widely regarded as one of the best operators in the Permian. We are very excited to grow our relationship to handle all of Centennial’s Southern Delaware produced water.”

Like this article? Sign up to our free newsletter

MOST POPULAR

FURTHER READING

Featured