NGL Energy To Acquire Hillstone Environmental Partners For About $600 Mln

(RTTNews) - NGL Energy Partners LP (NGL) said it has agreed to acquire all of the equity interests of Hillstone Environmental Partners, LLC from Golden Gate Capital for about $600 million, subject to certain adjustments.

Hillstone provides water pipeline and disposal infrastructure solutions to producers with a core operational focus in the state line area of southern Eddy and Lea Counties, New Mexico and northern Loving County, Texas in the Delaware Basin.

Hillstone has a fully interconnected produced water pipeline transportation and disposal system that currently consists of 19 salt water disposal wells, representing approximately 580,000 barrels per day of permitted disposal capacity. It also a newly-built network of produced water pipelines with about 680,000 barrels per day of transportation capacity.

In addition, Hillstone has another 22 permits to develop another 660,000 barrels per day of disposal capacity.

NGL Energy said it expects to integrate the Hillstone system into its existing Delaware Basin platform to maximize uptime and redundancy for its producer customers.

"We have made substantial progress in our ongoing water strategy in the Delaware Basin, and the Hillstone acquisition represents another important milestone for our Water Solutions franchise following the closing of our combination with Mesquite in July. This transaction is highly complementary to our Delaware Basin asset footprint," said Mike Krimbill, NGL Energy's CEO.

NGL Energy said it has arranged financing for the transaction including certain preferred equity and debt commitments in an amount necessary to fund the entire purchase price.

The company expects this transaction to close in 2019. The transaction is expected to be accretive to distributable cash flow per unit in fiscal 2021, the first full year of ownership.