Southcross Energy Partners LP (Southcross) and Southcross Holdings LP (Holdings) received a $175 million equity commitment, the companies said Aug. 19. They also discussed future dropdown plans for Eagle Ford midstream assets.
Charlesbank Capital Partners, EIG Global Energy Partners and Tailwater Capital provided the commitment, which will support liquidity and growth initiatives for both companies. Of the total, $50 million will support Southcross’ opportunities in the Eagle Ford Shale, including acquisitions. It will also support asset dropdowns from Holdings. The remaining $125 million will support Holdings’ inventory of Eagle Ford midstream dropdown assets.
Holdings fully owns Southcross Energy Partners GP LLC, the general partner of Southcross. It also fully owns limited partner interests in Southcross and several key assets. The capital will also support future Southcross growth projects.
The assets available for dropdown include the Robstown fractionator, the Lancaster gathering system and two NGL pipelines. There is also a treating facility. Several projects are currently underway to further enhance the value of these assets.
Train A of the Robstown fractionator is scheduled to be operational in September and will increase the facility’s capacity. Expansion of the Lancaster treating facility, which will double its capacity, is scheduled for completion in the third quarter of 2016.
Southcross aims to complete an Eagle Ford midstream asset dropdown every four to six months. The dropdowns could be completed by mid-2017. Southcross expects that the drop down of these assets could be completed as early as mid-2017.
Southcross Energy Partners LP is a Dallas-based MLP.
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