Stakeholder Midstream LLC said April 10 it expanded its capabilities in the Permian Basin with the purchase of a gas gathering system in the Northwest Shelf of southeast New Mexico.
The San Antonio-based company agreed to acquire the Lovington Gas Gathering System, which serves producers in Lea and Chaves counties, N.M., from Lucid Energy Group for an undisclosed amount. Stakeholder is backed by EnCap Flatrock Midstream.
The Lovington system is comprised of about 295 miles of gas gathering lines, 7,400 horsepower of compression and a 35 million cubic feet per day refrigeration plant. The transaction is effective April 1, the company said.
Rob Liddell, Stakeholder principal and co-CEO, said the acquisition is the first step in developing the company's "ultimate vision for gas gathering, treating and processing in the area."
"We see a significant opportunity in the Northwest Shelf, where there is increasing activity by producers focused on acreage that provides not only attractive returns but also a lower-cost entry point than some of the core areas of the Midland and Delaware basins," Liddell said in a statement.
In addition, Stakeholder said the Lovington system will complement the company's newly constructed San Andres Crude Gathering System in Yoakum County, Texas, and Lea.
The crude oil system will be fully operational in early May and currently consists of about 60 miles of gathering lines and multiple downstream connections. The company said the system will provide access to the market center in Midland, Texas, to regional refineries, and to long-haul pipelines capable of delivering crude to the Gulf Coast.