Sustainable water and chemical solutions provider Select Energy Services Inc. acquired Breakwater Energy Partners LLC, along with water gathering pipeline and disposal assets from Cypress Environmental Services LLC in the Bakken shale, according to a company press release on Nov. 2.

Breakwater's infrastructure, recycling and logistics business in the Permian Basin will help "to further our growth, consolidation and sustainability strategies," while the Cypress assets will add "to our infrastructure scale and development opportunities in the Bakken," Select chairman and CEO John Schmitz commented in the release.

"With these additions, we have meaningfully enhanced our water infrastructure and water services footprints, and significantly expanded the capacity and reach of our sustainable recycling solutions," he added.

The company completed the Breakwater acquisition through a stock-for-stock transaction, issuing approximately 9.2 million share of Select Series Class A common stock and repaying or assuming approximately $12.6 million of outstanding debt and other obligations in connection with closing on Nov. 1.

Select also issued approximately 950,000 shares of Series Class A common stock as consideration for the Cypress assets transaction on Nov. 1.

From the combined acquisitions, Select expects to add an additional $110 million to $115 million of revenue, as well as more than $30 million of adjusted EBITDA on a full year basis for 2022.

"We expect to see immediately accretive benefits from both acquisitions and believe we have a meaningful opportunity to invest organically around the acquired operations and asset footprints as well," Schmitz said.

Breakwater's portfolio comprises 0.6 MMbbl/d of operational capacity across four commercial recycling facilities, Select said, with a fifth facility currently in development. The four facilities also have an incremental 1.4 MMbbl/d of permitted recycling capacity available for development.

Breakwater also operates nine active modular recycling facilities yielding 1.5 MMbbl/d of throughput capacity supported by 46 miles of gathering and distribution pipelines, 70,000 bbl/d of wastewater disposal capacity, 4.7 MMbbl of storage capacity and 3.7 MMbbl of additional permitted storage capacity available for development.

Select's acquired Cypress assets include eight saltwater disposal facilities across North Dakota with 85,000 bbl/d of permitted capacity.

Select retained Bank of America Securities Inc. as financial advisor and Vinson & Elkins as legal counsel in the Breakwater transaction, while Jefferies LLC and Locke Lord LLP acted as financial advisor and legal counsel to Breakwater, respectively.

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