Midstream – Gathering System
In June 2009, EIG formed a new entity to acquire the West Texas gathering assets of a publicly traded exploration and production company.
EIG had followed the acquired gathering assets and associated reserves for over a decade, and also had a 15 year relationship with the seller. EIG approached the seller and ultimately struck a deal whereby EIG acquired the assets and the seller obtained liquidity for its core upstream business. The gathering assets are leased back to the seller under long-term ship-or-pay contracts that entitle EIG to a primarily fixed tariff for capacity on the system.