Azure Midstream Partners LP, Dallas, has completed the sale of one of its East Texas gas plants and an associated gathering line to Align Midstream Partners LP, a portfolio company of Dallas-based private equity firm Tailwater Capital LLC.
The deal included Align Midstream’s purchase of the 100-MMcfd Panola I cryogenic gas processing plant and 54-mile, 100-MMcfd Lake Murvaul gathering system, which crosses Panola and Rusk Counties, Tex., for $44.9 million in cash proceeds, Azure Midstream said.
The midstream assets were part of Azure Midstream’s Panola system, which provides gathering and processing services to producers active in the Cotton Valley and Haynesville shale plays.
The sale will enable the company to reduce its debt by $41 million and increase its annual earnings before interest, taxes, depreciation, and amortization run rate by about $1.5 million with elimination of fixed costs associated with the now-liquidated plant and pipeline, said I.J. Berthelot II, Azure Midstream’s chief executive officer.
Azure Midstream will continue to own and operate 210 MMcfd of natural gas processing capacity as well as more than 950 miles of gathering pipeline in East Texas and North Louisiana.
Alongside a remaining 120-MMcfd cryogenic gas processing plant, Azure Midstream’s Panola system includes an NGL pipeline with 10,000-b/d takeaway capacity, as well as the 11-mile, 100-MMcfd Oak Hill lateral gathering line, according to the company’s web site.
Contact Robert Brelsford at [email protected].
