On Point's water infrastructure asset base adds 17 new saltwater disposal wells and more than 432 500 bpd of permitted disposal capacity to Gravity's existing water midstream business. On Point has obtained saltwater disposal permits for 120 000 bpd of additional permitted disposal capacity and the right to develop disposal permits for an additional 305 000 bpd of capacity targeting the Ellenburger formation. Financial terms of the transaction are not being disclosed.
Pro forma for the acquisition, Gravity will own and manage more than 50 active saltwater disposal wells with more than 1 million bpd of permitted disposal capacity. In connection with the closing of the acquisition, Trace Hight, founder and CEO of On Point, will join Gravity as its Chief Commercial Officer of Water Infrastructure.
Rob Rice, Gravity's President and CEO, stated, "This acquisition is transformational for Gravity and enables the company to offer expanded water handling infrastructure for producers operating in the core of the Midland Basin. Gravity continues to focus on providing the most reliable and efficient produced water gathering and disposal infrastructure for its customers. We are excited to expand our platform and welcome On Point and its proven management team to Gravity."
"This transaction represents a critical step in Gravity's continued evolution into a premier, integrated water midstream platform with leading scale in the Permian Basin. Gravity is the dominant produced water platform in the core of the Midland Basin, which is one of the most active oil and gas regions in the country," said José E. Feliciano, Chairman of Gravity and Co-Founder and Managing Partner of Clearlake, and Colin Leonard, a Partner at Clearlake. "We are excited to leverage Gravity's enhanced scale to fuel organic growth by capitalising on significant business development opportunities driven by Gravity's customers' desire to address their rapidly expanding produced water handling needs through contracted, long-term agreements."
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/07112019/gravity-to-acquire-midland-basin-water-disposal-company/