ONEOK has finalized its previously announced acquisition of Medallion Midstream from Global Infrastructure Partners (GIP) for approximately $2.6 billion in cash. Medallion was previously the largest privately held crude oil gathering and transportation system in the Permian’s Midland Basin, featuring more than 1,200 miles of crude oil gathering pipelines (blue lines in below map) with a capacity of approximately 1.3 MMb/d and crude oil storage of around 1.5 MMbbl. (The Medallion Delaware Basin system — green lines covered by red X in below map — is owned by Energy & Minerals Group and is not included in this acquisition).
The transaction significantly expands ONEOK’s crude oil footprint in the Permian. The Medallion Midland Basin system feeds crude oil to hubs in Midland, Colorado City and Crane. In our Crude Oil Permian Report, we track these receipts, which feed ONEOK’s long-haul Permian-to-Houston pipelines — BridgeTex and Longhorn — as well as other third party pipelines.
This deal by ONEOK complements its $18.8 billion acquisition of Magellan Midstream, which we covered in Tulsa Time. That deal created the second-largest U.S. midstream company by market capitalization and the fifth-largest by enterprise value. In addition, as of October 15, ONEOK is the managing member of EnLink after acquiring GIP’s controlling interest for approximately $3.3 billion (see our Analyst Insight). For more details on these multibillion-dollar deals with GIP, see Islands In The Stream.
