Midstream Business Anatomy of a Deal: Tailwater Capital

Tailwater Capital’s premise is that demand for affordable, reliable energy isn’t going anywhere. The private equity firm’s deals are designed to help supply it.

Crisscrossing more than 750 miles, Tall Oak II’s Midcontinent assets include low- and high-pressure gathering lines across eight Oklahoma counties. Tall Oak III consists of more than 320 miles. (Source: Tall Oak)

[Editor's note: A version of this story appears in the April 2021 issue of Midstream Business magazine.]

Jason Downie, co-founder and managing partner of Dallas-based Tailwater Capital LLC, has a take on the irresistible topic of the weather—and specifically one of the coldest and deadliest winter storms Texas has seen in decades: Solve it.

In mid-February, temperatures in the state averaged just 11.8 degrees Fahrenheit, caused by an “Arctic air insurgence.” With power knocked out for millions, Texans were left cold, miserable and uncertain. The storm even claimed more than four dozen lives. Downie and his team want to help challenge and solve the state’s power generation shortcomings to prevent this from happening again.

Downie’s perspective on the need for reliable natural gas can be seen firsthand in Tailwater’s most recent flurry of transactions: the acquisitions of Tall Oak Midstream II and III in January, as well as NorTex Midstream Partners LLC in February. [At press time, Tailwater announced another deal to buy Redcliff Midstream with gas gathering, treating and processing services in Oklahoma’s STACK play.]

And these deals are just a precursor to what he sees as an active year in the midstream space.

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Darren Barbee

Darren Barbee is senior editor for Oil and Gas Investor magazine.