JP Energy Acquires Wildcat Permian Services, Partners With Approach

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Estimated Price
$108.0MM
Description

To acquire all equity interests in Wildcat Permian Services LLC and form crude oil partnership with Approach in the Permian.

JP Energy Development LP has agreed to acquire all of the equity interests in Wildcat Permian Services LLC from Wildcat Midstream Mesquite LLC and Approach Midstream Holdings LLC.

JP Energy Development is an affiliate of JP Energy Partners LP. Approach Midstream Holdings is an affiliate of Approach Resources Inc. (Nasdaq: AREX). The transaction is expected to close late in the third quarter or early 4Q 2013.

Wildcat owns and operates a long-term contracted oil pipeline system consisting of 50 miles of high-pressure, steel pipeline in Crockett and Reagan counties, Texas, with throughput capacity of 100,000 barrels per day (bbl/d), truck terminals and LACT bay facilities, multiple receipt points and 40,000 bbl of crude oil storage. JP Energy provides an integrated platform of crude oil gathering, transportation and marketing services to producers and refiners in the midcontinent area, and the acquisition of Wildcat will extend JP Energy’s reach into the rapidly growing southern Midland Basin, and will further diversify JP Energy’s portfolio of transportation and storage assets.

In connection with the acquisition of Wildcat, JP Energy and Approach will enter into a revised crude oil purchase agreement under which JP Energy will purchase and transport Approach’s crude oil production from 110,000 acres in Crockett and Schleicher counties, Texas.

“JP Energy is excited to partner with Approach and to extend and diversify our portfolio into the Permian Basin,” J. Patrick Barley, JP Energy’s president and CEO, said in the release. “Approach’s management team has a proven track record of developing unconventional oil and gas properties in formations like the prolific Wolfcamp shale oil play.”

JP Energy Development LP is a crude oil midstream company that purchases, gathers, transports, blends, stores and markets crude oil for producers and refiners in the midcontinent area. JP Energy Development and JP Energy Partners LP are supported by equity commitments from affiliates of ArcLight Capital Partners LLC. The company is headquartered in Irving, Texas.

Approach Resources Inc. is an independent energy company engaged in the acquisition, development, exploration, and production of oil and gas properties in the U.S. The company is headquartered in Fort Worth, Texas.