The Denver-Julesburg Basin isn’t the Permian — no argument there. But like its much bigger brother in West Texas and southeastern New Mexico, the DJ Basin has been a hotbed of M&A in both the upstream and midstream sectors. Among DJ producers, Chevron, Civitas Resources and Occidental Petroleum (Oxy) are now the top dogs, with big hopes for the future there. And, as we’ll discuss in today’s RBN blog, a handful of midstreamers have taken on leading roles in crude oil and gas gathering (and processing) in Weld County, CO, the heart of the basin.
As we said in Part 1, when activity in the DJ Basin was ramping up a few years ago, production was widely scattered among a dozen or more E&Ps. But, as in the Permian and other major plays, there’s been a flurry of upstream consolidation in the DJ and almost three-quarters of the basin’s production now comes from Chevron, Civitas and Oxy (in that order), with a handful of other producers bringing up the rear. The E&P merger mania started in earnest back in 2019, when Oxy acquired Anadarko Petroleum, giving it a foothold in Colorado. Then, in 2020, Chevron bought Noble Energy, which gave the acquiring company its first DJ assets, and in 2023 it followed that up with the acquisition of DJ-focused PDC Energy. And don’t forget Civitas, a DJ Basin native that over the space of 12 months in 2021-22 gobbled up one smaller producer after another, emerging as a major player of its own.
The consolidation among DJ midstreamers hasn’t been quite so dramatic, but it’s hard to ignore. Most recently, in July, privately held Elevation Midstream announced that it had merged with ARB Midstream’s Platte River Holdings subsidiary. (Financial terms of the deal were not disclosed.) Elevation brought with it oil, gas and produced-water gathering assets in southwestern Weld County and northwestern Adams County (light-blue-shaded area in Figure 1), as well as a central gathering facility (CGF; dark-blue triangle) with 50 Mb/d of crude stabilization capacity. (Stabilizers remove dissolved gases to meet takeaway-pipeline vapor pressure specifications and water and other impurities to meet crude-quality specs.) From the CGF, the oil gathered by Elevation is piped on ARB Midstream/Platte River Holdings’ 32-mile, 90-Mb/d Badger Pipeline (green line) to the company’s Platteville terminal (pink square) and connections with the Saddlehorn/Grand Mesa Pipeline (gold line); the Northeast Colorado Lateral (NECL) branch of the Pony Express Pipeline system (red-and-white and red lines, respectively); and the White Cliffs Pipeline (blue line), all of which run to the Cushing, OK, oil hub.
Figure 1. Elevation Midstream’s Post-Merger Assets in the DJ Basin. Source: RBN
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