Crestwood Midstream Partners completes acquisition of midstream assets from Devon Energy

Crestwood Midstream Partners has completed the acquisition of midstream assets from Devon Energy subsidiaries for a cash consideration of $87.1m.

The amount paid is $2.9m less than the originally announced acquisition price, owing to closing adjustments and operating activity since July 1, 2012.

The company acquired gathering and processing assets located in south-western area of the Barnett Shale.

Assets include a 74 mile low-pressure rich natural gas gathering system, a cryogenic processing facility with a capacity of 100 million cubic feet per day and 23,100 horsepower of compression equipment.

Both companies have also entered into a fixed-fee gathering, processing and compression agreement for a period of 20 years which covers existing and future production from an approximate 20,500 acre dedication.

Devon has maintained an active drilling and development plan for the West Johnson County area which currently gathers from approximately 230 wells.

It expects to continue to further develop the properties in 2013.

Crestwood general partner chairman, president and chief executive officer Robert G Phillips said the completion of the transaction expands the company’s rich gas operations.

"The acquisition will lead to increased utilisation of our existing assets in the Barnett Shale, should add substantially to Crestwood’s distributable cash flow and was fully funded from available borrowing capacity under our revolving credit facility," said Phillips.

Image: Devon’s West Johnson County natural gas processing plant in north Texas. Photo: Devon Energy.