WPX to form JV

The joint venture will complete the buildout of a new crude oil gathering system, already started by WPX in the basin, and begin constructing a new cryogenic natural gas processing complex with a planned initial capacity of 400 million ft³/d. The parties plan to seek out third-party volumes in an area of mutual interest in the Delaware Basin.

WPX has a 50% voting interest in the joint venture and operational influence. The transaction value of US$863 million for the new joint venture is based on the cash to WPX, the capital carry and WPX’s ownership interest.

The parties expect to close the transaction in the 3Q17 subject to certain closing conditions. Prior to closing, WPX and Howard will begin integrating efforts to continue to build out the crude oil gathering system and begin work on the cryogenic processing plant.

The parties expect to complete the first 200 million ft³/d train for the cryogenic natural gas processing complex in the first half of 2018. The parties plan to add a second train to double the capacity by the middle of 2019.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/05072017/wpx-to-form-jv/