Houston-based Plains All American Pipeline LP has expanded its Eagle Ford portfolio with a $125 million acquisition of certain Eagle Ford infrastructure assets from a subsidiary of Chesapeake Energy Corp. The acquisition includes crude oil and condensate gathering assets in the Eagle Ford area of South Texas and is estimated by Baird Equity Research to be between 0% and 2% accretive to distributable cash flow (DCF) per unit.
Pro forma for Plains All American’s previous $750 million senior note offering, $500 million acquisition of Bakken assets, and this $125 million acquisition, Baird analysts estimate the company has approximately $1.0 billion in available liquidity and does not anticipate that it will need to issue equity in the near term.
The acquired assets include approximately 40 miles of crude oil/condensate gathering pipelines with a throughput capacity of approximately 50,000 barrels per day; 150,000 barrels of existing crude oil and condensate storage capacity; 300,000 barrels of storage capacity under construction and a truck unloading terminal. In support of the transaction, Chesapeake has provided long-term acreage dedications of future production in Webb and Dimmit counties.
PAA owns a network of approximately 18,000 miles of liquids pipelines, 120 million barrels of liquids storage capacity and handles more than 3 million barrels of physical product on a daily basis.
Plains All American Pipeline LP (NYSE: PAA) is a publicly traded master limited partnership engaged in the transportation, storage, terminalling and marketing of crude oil and refined products, as well as in the processing, transportation, fractionation, storage and marketing of natural gas liquids. Through its general partner interest and majority equity ownership position in PAA Natural Gas Storage LP (NYSE:PNG), PAA owns and operates natural gas storage facilities.