Tallgrass Energy Partners Acquires Redtail Water Business from Whiting and Announces Intent to Increase Its Distribution for the Fourth Quarter of 2015
Tallgrass Energy Partners, LP (NYSE: TEP) today announced that through
its subsidiary BNN Water Solutions it has closed on the $75 million
acquisition of Whiting Oil & Gas Corporation’s Redtail Saltwater
Disposal and Fresh Water Transportation and Storage System in Weld
County, Colo. The acquisition includes a fresh water delivery and
storage system and a produced water gathering and disposal system that
together comprise 62 miles of pipeline along with associated fresh water
ponds and disposal wells. The purchase agreement with Whiting includes a
five-year fresh water service contract and a nine-year gathering and
disposal contract, each of which includes annual minimum volume
commitments in line with Whiting’s currently expected volumes. Whiting
also dedicated approximately 148,000 acres to the Redtail Water System.
Tallgrass expects the acquisition to be immediately accretive to
unitholders.
“As a natural expansion of our water services business, this
acquisition highlights our ability to help producers reduce their water
costs and maximize returns in a challenged commodity environment,” said
Tallgrass Chief Operating Officer Bill Moler. Moler added, “Tallgrass
intends to continue growing its water services business in the Rockies,
Permian, Eagle Ford and other production areas to help companies that
are seeking cost reductions in fresh water, disposal, recycling and
general water management.”
Intention to Increase Fourth Quarter 2015
Distribution
TEP also announced that it intends to recommend to the Board of
Directors of its general partner an increase in the distribution for the
fourth quarter of 2015 to $0.64 per unit, or $2.56 per unit annualized.
The increase would represent a 6.7 percent increase over the
distribution for the third quarter of 2015, and a 32 percent increase
over the distribution for the fourth quarter of 2014.
About Tallgrass Energy Partners, LP
Tallgrass Energy Partners, LP (NYSE: TEP) is a publicly traded,
growth-oriented limited partnership formed to own, operate, acquire and
develop midstream energy assets in North America. TEP currently provides
natural gas transportation and storage services for customers in the
Rocky Mountain and Midwest regions of the United States through its
Tallgrass Interstate Gas Transmission and Trailblazer Pipeline systems.
It provides crude oil transportation to customers in Wyoming, Colorado
and the surrounding regions through its membership interest in Tallgrass
Pony Express Pipeline. TEP also provides services for customers in
Wyoming through Tallgrass Midstream at its Casper and Douglas natural
gas processing and its West Frenchie Draw natural gas treating
facilities and provides water business services to customers in Colorado
and Texas through BNN Water Solutions. TEP’s operations are
strategically located in and provide services to certain key United
States hydrocarbon basins, including the Denver-Julesburg, Powder River,
Wind River, Permian and Hugoton-Anadarko Basins and the Niobrara,
Mississippi Lime, Eagle Ford and Bakken shale formations.
To learn more, please visit our website at www.tallgrassenergy.com.
About BNN Water Solutions
BNN provides permanent water infrastructure and innovative solutions to
clients across multiple industries. Our operations, construction and
engineering experience supports our strategic partnerships and patented
technologies to create value for our clients. BNN’s core business is
executing reliable, efficient and cost-effective water management
programs. Our proven approach to water management consistently drives
efficiency into our clients’ operations, leading to cost savings and
environmental benefits. BNN has the ability to fund, design, build and
operate water assets and infrastructure throughout the entire lifecycle
of a project.
To learn more, please visit our website at www.bnn-energy.com.
Forward-Looking Statements
Disclosures in this press release contain “forward-looking statements.”
All statements, other than statements of historical facts, included in
this press release that address activities, events or developments that
management expects, believes or anticipates will or may occur in the
future are forward-looking statements. Without limiting the generality
of the foregoing, forward-looking statements contained in this press
release specifically include the accretive nature of the acquisition of
Whiting Oil & Gas Corporation’s Redtail Saltwater Disposal and Fresh
Water Transportation and Storage System, TEP's ability to help producers
reduce their water expense and maximize return, and the intent to
recommend a distribution increase to the Board of Directors of the
general partner of TEP. Such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the
control of TEP, which may cause actual results to differ materially from
those implied or expressed by the forward-looking statements, and other
important factors that could cause actual results to differ materially
from those projected, including those set forth in reports filed by TEP
with the Securities and Exchange Commission. Any forward-looking
statement applies only as of the date on which such statement is made
and TEP does not intend to correct or update any forward-looking
statement, whether as a result of new information, future events or
otherwise, except as required by law.
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