Enterprise Products Partners acquires Pipeline and Fractionator from Western Midstream for $400m

Enterprise Products Partners L.P. (NYSE: EPD), a leading North American provider of midstream energy services, announced on Tuesday that it has acquired pipeline and fractionator interests from Western Midstream Partners, LP (NYSE: WES) for $400 million in cash.

The deal includes a 20 percent stake in Whitethorn Pipeline Company LLC, which owns a 620,000 barrel per day crude oil pipeline from Midland to Sealy, Texas, and a 25 percent stake in Enterprise EF78 LLC, which owns two natural gas liquids (NGL) fractionators with a combined capacity of 170,000 barrels per day in Mont Belvieu, Texas. With these acquisitions, Enterprise now owns 100 percent of both Whitethorn and EF78.

“We are pleased to complete these transactions to consolidate ownership in these midstream assets,” said A. J. “Jim” Teague, co-chief executive officer of Enterprise’s general partner.

“The pipeline asset serves the prolific Permian Basin, and the fractionation assets are integral to our NGL system. These transactions are immediately accretive to Enterprise’s distributable cash flow per unit.”

The deal also includes a 15 percent stake in Panola Pipeline Company, LLC, which owns a 253-mile pipeline that transports mixed NGLs from East Texas to Chambers County, Texas. Upon closing of this transaction, Enterprise will own up to 70 percent of Panola, subject to the rights of other owners.

The transactions were completed and funded on February 16, 2024 using a combination of cash on hand and proceeds from the issuance of short-term notes under the partnership’s commercial paper program.

Enterprise Products Partners said that the acquisitions will enhance its integrated midstream network and provide operational and commercial synergies. The partnership expects the transactions to be immediately accretive to its distributable cash flow per unit.

Enterprise Products Partners L.P. is one of the largest publicly traded partnerships and a leading North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products and petrochemicals.

Services include: natural gas gathering, treating, processing, transportation and storage; NGL transportation, fractionation, storage and marine terminals; crude oil gathering, transportation, storage and marine terminals; petrochemical and refined products transportation, storage and marine terminals; and a marine transportation business that operates on key U.S. inland and intracoastal waterway systems.

The partnership’s assets currently include more than 50,000 miles of pipelines; over 300 million barrels of storage capacity for NGLs, crude oil, petrochemicals and refined products; and 14 billion cubic feet of natural gas storage capacity.