Houston-based Apache Corp. and a California investment firm are entering into a partnership that will create a $3.5 billion pipeline and energy processing company in West Texas.
The agreement between Apache Corp. and Los Angeles-based Kayne Anderson Acquisition Group will create Altus Midstream LP. Apache Corp. will contribute its midstream assets at its Alpine High shale oil and gas play to Altus Midstream, while Kayne Anderson Acquisition Group will contribute $952 million in cash.
Apache Corp. will own a 71 percent percent stake in Altus Midstream, which will be based in Houston.
The Altus Midstream assets in West Texas’ Permian Basin oil field will include at least 380 million cubic feet a day of natural gas processing facilities, 178 miles of gathering and processed gas pipelines, connections to multiple markets.
The estimated market capitalization of $3.5 billion is based on the assumed sale of 354.4 million common shares at $10 a share.
This article first appeared on the Houston Chronicle – an Energy Voice content partner. For more from the Houston Chronicle click here.