Medallion Midstream LLC has entered into an agreement with Laredo Petroleum Inc., a subsidiary of Laredo Petroleum Holdings Inc. [NYSE: LPI] to provide midstream infrastructure to gather, process, and transport natural gas and crude oil that is expected to be produced from Laredo’s acreage primarily located in Mitchell County, Texas.
Medallion’s first phase of construction will include about 10 miles of gathering pipeline to connect Laredo’s initial wells and up to 60 MMCFD of gas processing capacity. Medallion’s ultimate goal is to expand this system throughout the area to provide service to multiple producer customers, lowering costs to transport and process the company’s production, accessing downstream markets for all its products, and increasing its netbacks.
“We are very excited to support Laredo in the development of their oil and rich-gas acreage in the Midland Basin,” said Randy Lentz, CEO of Medallion. “The construction of this midstream system is the first step of our Midland Basin development plan which will provide full integrated services for our producer customers.”
Medallion is owned by its management team and The Energy & Minerals Group. Medallion operates rich natural gas gathering and processing systems in Texas and Oklahoma and is a large service provider in the Hardeman Basin oil play.
The Energy & Minerals Group is a highly specialized private equity firm that focuses exclusively on investing across various facets of the global natural resource industry that are integral to the global economy. EMG has $5.6 billion of total investor commitments (including co-investments) of which in excess of $2.5 billion has been deployed across the energy complex since inception.