Energy Transfer announces major merger with Crestwood Equity Partners

Dallas, Texas - Dallas-based energy conglomerate Energy Transfer announced its intention on Wednesday to merge with Houston's Crestwood Equity Partners in a deal valued at approximately $7.1 billion.

This anticipated transaction, slated to conclude by the end of 2023, hinges on regulatory clearances and the affirmative vote of Crestwood's shareholders. The terms of the merger indicate that Energy Transfer will absorb $3.3 billion of Crestwood's liabilities, according to an official communication.

The strategic acquisition encompasses Crestwood's significant assets in West Texas, Wyoming, and the Dakotas, which notably possess 3.4 billion cubic feet of daily gas processing capacity and a crude gathering capability of 340 thousand barrels per day. This move will enrich Energy Transfer's holdings with terminal and storage assets, potentially adding another 10 million barrels of storage capacity, complemented by trucking and rail terminal additions.

Speaking to investors, Energy Transfer highlighted the inherent value of the merger, emphasizing the broader scale and synergy it would bring. The company elaborated, "CEQP’s substantial processing capacity in the Williston and Delaware basins complements ET’s significant downstream fractionation capacity at Mont Belvieu and hydrocarbon export capability from both Nederland, Texas and the Marcus Hook complex in Philadelphia, Pennsylvania."

Kelcy Warren, Energy Transfer's executive chairman, renowned for his strategic vision, has a track record of notable integrations. Under his leadership, the company has seen prominent mergers such as Transwestern Pipeline in 2006, Sunoco in 2012, and the more recent addition of Lotus Midstream. As of now, Energy Transfer manages a significant portfolio, encompassing nearly 125,000 miles of pipelines and related infrastructure.

Credit: Energy Transfer, Dallas Metro News