Noble Midstream Partners and Greenfield Midstream’s JV to acquire Saddle Butte Pipeline

Vinson & Elkins advised Noble Midstream Partners LP in connection with the formation of Black Diamond Gathering, LLC (“Black Diamond”), a joint venture with Greenfield Midstream, LLC, and Black Diamond’s definitive agreements to acquire Saddle Butte Rockies Midstream, LLC and affiliates for $625 million.

Noble Midstream Partners LP (NYSE: NBLX) (“Noble Midstream” or the “Partnership”) and Greenfield Midstream, LLC announced today the formation of a joint venture, Black Diamond Gathering, LLC (“JV” or “Black Diamond”). The JV has entered into definitive agreements to acquire Saddle Butte Rockies Midstream, LLC and affiliates (collectively “Saddle Butte”) for $625 million. Greenfield Midstream is an EnCap Flatrock Midstream portfolio company.

Noble Midstream will fund 50% of the purchase price and will receive a 4.4% ownership promote in the JV. The Partnership’s 54.4% ownership of the JV will be held in a wholly owned Noble Midstream subsidiary, Laramie River DevCo LP. Greenfield Midstream will own 45.6% of the JV.

Saddle Butte assets include a large-scale integrated crude oil gathering system in the DJ Basin, consisting of approximately 160 miles of pipeline in operation, 300,000 barrels per day of delivery capacity and approximately 210,000 barrels of crude oil storage capacity. Saddle Butte has approximately 115,000 dedicated acres from six customers under fixed fee arrangements, including approximately 72,000 dedicated acres from PDC Energy. Upon the closing of the acquisition, PDC Energy plans to expand its Saddle Butte acreage dedication to approximately 96,000 acres and extend its dedication by five years, bringing the dedication contract duration to approximately 12 years from close.

Noble Midstream will operate and control the Saddle Butte system upon closing, which is expected in the first quarter of 2018, subject to customary closing conditions, including the receipt of regulatory approvals. Noble Midstream and Greenfield Midstream will jointly provide commercial efforts to attract further producer dedications.

Vinson & Elkins advised Noble Midstream Partners LP with Bryan Loocke (Picture), senior associate Brittany Sakowitz and associates Megan Stephens Menniti, Kyrie Hayden and Caroline McDonald and the JV formation was led by partner Doug Bland and associates Ali Choate and Jordan Fossee.

Also advising were partner Sean Becker and senior associate Christie Alcalá; counsel Damien Lyster and associate Victoria Galvez; senior associate Matt Dobbins and associate Rachel Comeskey; partner Neil Imus and associate Ryan Will; partners Todd Way and Ryan Carney and associates Julia Pashin and Christine Mainguy; and partner Stephen Jacobson and associate Amy Benford.

 

Involved fees earner: Bryan Loocke – Vinson & Elkins LLP; Ali Choate – Vinson & Elkins LLP; Jordan Fossee – Vinson & Elkins LLP; Brittany Sakowitz – Vinson & Elkins LLP; Douglas Bland – Vinson & Elkins LLP; Megan Stephens Menniti – Vinson & Elkins LLP; Kyrie Hayden – Vinson & Elkins LLP; Damien Lyster – Vinson & Elkins LLP; Victoria Galvez – Vinson & Elkins LLP; Sean Becker – Vinson & Elkins LLP; Christie Alcalá – Vinson & Elkins LLP; Stephen Jacobson – Vinson & Elkins LLP; Amy Benford – Vinson & Elkins LLP; Matthew Dobbins – Vinson & Elkins LLP; Rachel Comeskey – Vinson & Elkins LLP; Neil Imus – Vinson & Elkins LLP; Ryan Will – Vinson & Elkins LLP; Todd Way – Vinson & Elkins LLP; Julia Pashin – Vinson & Elkins LLP; Ryan Carney – Vinson & Elkins LLP; Christine Mainguy – Vinson & Elkins LLP;

Law Firms: Vinson & Elkins LLP;

Clients: Noble Midstream Partners LP;

 

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Author: Ambrogio Visconti