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Expansion Is The Goal: Ironwood II Completes Asset Merger And Assumes Management of Nuevo Midstream Dos’ Eagle Ford Assets
11/23/21![Ironwood-II-Completes-Asset-Merger-And-Assumes-Management-of-Nuevo-Midstream-Dos-Eagle-Ford-Assets](https://images2.rextag.com/public/blog/Ironwood-II-Completes-Asset-Merger-And-Assumes-Management-of-Nuevo-Midstream-Dos-Eagle-Ford-Assets.png)
On Nov. 16, Ironwood Midstream expanded its Eagle Ford Shale operations through its merger with Nuevo Midstream Dos. Nuevo's assets, including its equipment and pipelines, along with a truck station and 300,000 barrels of crude oil storage, have been taken over by Ironwood II’s leadership team.
Earlier in the month, Ironwood CEO William Williams expressed in a statement that this acquisition heralds the company's goal of expanding its midstream infrastructure. With the title of the lead supplier of safe, consistent, and competitive access to high-quality and growing markets along the Texas Gulf Coast at stake.
The companies, both of which have private equity backing in the form of EnCap Flatrock Midstream, said in the release, that they have completed a merger and are currently managing Nuevo Midstream's Eagle Ford assets. It is not yet known how the deal was structured.
However, as a result of the consolidation of complementary Eagle Ford assets, EnCap is now poised for growth and value creation. The merger also brought Nuevo’s President and CEO Randy Ziebarth onto the Ironwood board.
In fact, Nuevo and EnCap Flatrock Midstream have had a successful partnership together for some time already. As part of its formation, Nuevo Dos received an initial equity commitment of $400 million from EnCap Flatrock Midstream way back in 2015. But Nuevo’s management team was acquainted with EnCap even before this: thanks to such backing, they were able to develop and ultimately sell a similar midstream footprint in the Delaware Basin to Western Gas a year prior, in 2014.
Now, the Eagle Ford team has established highly valuable relationships in the area and has excelled at commercializing the assets in this region. As part of its entry into the Eagle Ford Shale in 2019, Nuevo acquired Republic Midstream LLC from an ArcLight Capital Partners affiliate. In South Texas, Nuevo’s new assets include approximately 100 miles of crude oil gathering pipeline that feed the Lavaca Terminal, a crude oil storage facility with 300,000 barrels and a truck staging area.
Besides Nuevo's terminal, the system consists of a 26-mile pipeline connecting the terminal to downstream refineries, petrochemical installations, and export terminals located on the coast.
Due to this merger, Ironwood II has increased its crude oil and natural gas throughput capacities in the Eagle Ford region to approximately 400,000 barrels and 410 million cubic feet per day, respectively. With 390 miles of crude oil and natural gas pipelines, the company manages 245,000 acres of dedicated land.
In addition, the company operates 40,000 barrels per day of throughput capacity in the Permian Basin in Midland County, Texas, which delivers crude oil to the Centurion Pipeline. Ironwood II’s strategic footprint in the Eagle Ford provides multiple connections to long-haul pipelines and premium access to key Gulf Coast markets.
Attorneys Mayer Brown and Locke Lord acted for Ironwood II. Shearman & Sterling represented Nuevoand Encap Flatrock Midstream.
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The green trend: TC Energy pledges to be carbon-free by 2050
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TC Energy, the Canadian gas giant, recently announced its environmental, social, and governance goals, as well as emission reduction strategies. The company aims to become 100% emission-free by 2050 while promising to cut greenhouse gas emissions intensity from its operations by 30% by 2030 as an interim measure.
Ain't Nothing Like a $2 Billion Deal: Oasis Sells Midstream Affiliate to Crestwood
![$data['article']['post_image_alt']](https://images2.rextag.com/public/blog/Oasis_Petroleum_Crestwood_Equity_Partners_Oasis_Midstream_Partners.png)
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.
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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.