Magnum Hunter Resources reported that the company has signed an agreement to purchase midstream assets from a privately held oil services company. The assets are located in the United States and are used to process and treat natural gas.
Eureka Hunter Holdings, LLC, a subsidiary of the company, has agreed to pay total consideration of $58.5 million to TransTex Gas Services, LP for the assets. The amount is composed of $46.8 million in cash and common units of the company with a value of $11.7 million.
Magnum Hunter Resources will fund the cash portion of the purchase with capital provided by ArcLight Capital Partners. The asset purchase is expected to close in April 2012.
TransTex Gas Services, LP has gas treating assets in seven states, and the company services approximately 30 customers. These assets comprise well head separation equipment, storage tanks, sculpture separation equipment, and power generation units.
TransTex Gas Services, LP also has a fleet of 50 amine plants used to remove carbon dioxide and hydrogen sulfide from the natural gas stream.
Magnum Hunter Resources estimates that the assets purchased will generate $15.0 million in additional revenues in 2012, and an additional $7.5 million of EBITDA during the year.
For more information on the company, go to www.magnumhunterresources.com
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