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In Matador's Favor, For $75 Million Summit Sells Its Permian Midstream Assets
06/15/2022![In-Matadors-Favor-For-75-Million-Summit-Sells-Its-Permian-Midstream-Assets](https://images2.rextag.com/public/blog/71Blog_Matador_Acquires_Summit's_Lane_G&P_System_06_2022.png)
Matador Resources Co. acquires a gathering and processing system for $75 million in New Mexico’s Eddy and Lea counties from Summit Midstream Partners LP, filling up Matador’s midstream portfolio in the Permian Basin.
According to the company release, this purchase is a logical extension of their strategy to keep their midstream operations and assets in control in order to hasten and assist their operations.
Matador reached an agreement with a subsidiary of Summit to gain Summit’s Lane Gathering and Processing System on June 9. In connection with the transaction, the company will also appropriate a certain takeaway capacity on the Double E Pipeline, a FERC-regulated natural gas pipeline operated by Summit.
Nowadays, the Lane G&P System combines a 60 MMcf/d cryogenic natural gas processing plant, three compressor stations, and about 45 miles of natural gas gathering pipelines. It is expected that the company will enlarge the Lane G&P System to help Matador’s environmental, safety, exploration, and production efforts in northern Eddy and Lea counties located within the Delaware Basin.
Gathering and processing services on the Lane G&P System are provided under long-term, fee-based gathering agreements with producers that are primarily targeting crude oil production from the Bone Spring and Wolfcamp shale formations.
As an investor presentation says, Matador began its initial midstream build-out in the Delaware Basin in 2015-2016. Since then the company has extended its midstream footprint in the Delaware using the San Mateo I and San Mateo II joint venture partnerships with Five Point Energy LLC.
Serving as the primary midstream solution for Matador, San Mateo provides midstream services to other E&P operators in the Delaware Basin. It owns and operates oil, natural gas, and produced water gathering and transportation systems in Eddy County, N.M., and Loving County, Texas, the Black River Processing Plant in Eddy County with a designed inlet capacity of 460 MMcf/d of natural gas and 13 commercial saltwater disposal wells in Eddy County and Loving County with a combined designed disposal capacity of 335,000 bbl/d.
This acquisition of additional takeaway from the Delaware Basin is also made to ensure Matador’s and third-party customers’ natural gas is transported to market. The company notices the diligence of all sides in negotiating the transaction and looks forward to closing later this month.
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Occidental's Asset Cuts After CrownRock's $12 Billion Deal
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/210Blog_Occidental's $12 billion acquisition of CrownRock.png)
Occidental Petroleum is expanding its reach in the Midland Basin and targeting deeper drilling in the Barnett area through its significant $12 billion purchase of CrownRock LP. CrownRock, a collaboration between CrownQuest Operating LLC and Lime Rock Partners, is recognized for its prime land holdings in the Permian Basin. This acquisition brings over 94,000 net acres and 1,700 undeveloped drilling spots in the Midland Basin to Occidental's portfolio.
Ain't Nothing Like a $2 Billion Deal: Oasis Sells Midstream Affiliate to Crestwood
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Crestwood & Oasis Midstream merge to create a top Williston #basin player. $1.8 billion deal is expected to close during the Q1 of 2022. The transaction will result in a 21.7% ownership stake for Oasis in Crestwood common units. The remaining ownership of Oasis in Crestwood will also be of benefit to the company since it will create a diversified midstream operator with a strong balance sheet and a bullish outlook after this accretive merger.
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/297_Blog_Keystone XL Pipeline Controversy and Wildlife Disaster From Trump's Green Light to Biden's Red Light on the 15 Billion Project.jpg)
The pipeline industry in the USA faced and still faces a range of regulatory challenges, including permitting delays, environmental requirements, and public opposition to pipeline projects. In recent years, pipeline projects like the Keystone XL and Dakota Access pipelines had legal and regulatory obstacles that delayed or canceled their construction. Keystone XL Pipeline, proposed by TransCanada in 2008, aimed to transport crude oil from Canada (around Calgary and Edmonton) to refineries on the Gulf Coast (Port Arthur). The project faced opposition from environmental groups and indigenous communities, who argued that it would contribute to climate change and pose a risk to water resources. In 2015, President Obama rejected the project, citing concerns about its environmental impact. However, in 2017, President Trump revived the project, leading to further legal challenges. In June 2021, U.S. President Joe Biden officially canceled the project on his first day in office.
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/282_Blog_Renewable Natural Gas How RNG Changes the Industry.jpg)
The renewable natural gas (RNG) industry in the United States is showing promising signs of growth. As of 2019, the U.S. consumed 261 billion cubic feet (BCF) of RNG, primarily utilized by independent power producers, electric utilities, and various commercial and industrial entities. However, this figure represents only a small fraction of its potential. Research indicates that the U.S. could theoretically produce up to 2,200 BCF of RNG through anaerobic digestion alone, which would equate to about 11% of daily national natural gas consumption.
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/295_Blog_Renewable Efforts Lag as Global Oil and Gas Demand Continues to Rise.jpg)
Recently, the progress toward an energy transition is hitting a snag. Sales of electric vehicles are decelerating, and the growth in wind and solar power needs to be keeping pace with expectations. To make matters more challenging, electricity prices are climbing when they were expected to fall. Amidst these setbacks, the oil and gas sectors are proving resilient. According to BP's latest energy outlook, not only are these energy mainstays here to stay, but their demand is expected to remain relatively high even after reaching a peak. Interestingly, BP forecasts that oil demand will reach its zenith next year, marking a critical moment in energy consumption trends. This isn't the first time BP has projected a peak in oil demand. Back in 2019, their review anticipated a decline in demand growth, but the prediction fell flat. Instead, oil demand surged to unprecedented levels following the end of the global pandemic lockdowns, defying previous forecasts and underscoring the enduring dominance of traditional energy sources in the global market.