Devon Energy Sells EnLink Midstream Stakes for $3.1 Billion
Devon Energy said it has agreed to sell its ownership interests in EnLink Midstream Partners and Enlink Midstream to an affiliate of fund manager Global Infrastructure Partners (GIP) for $3.1 billion.
As part of this transaction, Devon will extend its fixed-fee gathering and processing contracts with respect to the Bridgeport and Cana plants with EnLink through 2029. The company’s minimum volume commitments for these agreements will expire at the end of 2018.
“The sale of our EnLink interests represents a significant step forward in achieving our 2020 Vision to further simplify our asset portfolio and return excess cash to shareholders,” said Devon's president and CEO, Dave Hager. "The EnLink proceeds, combined with proceeds from the non-core E&P assets already sold and those currently being marketed, will exceed our $5 billion divestiture target."
GIP has more than $40 billion under management and focuses its equity investments on infrastructure assets in the energy, transport and water/waste sectors. Enlink President and CEO Michael Garberding described GIP's investment as "an important next step in our journey as a leading midstream company."
"GIP has significant expertise and experience in the midstream industry that will enhance and elevate our growth plans, Garberding said. "We are thankful for the ownership relationship we've had with Devon, and we look forward to deepening our long-term commercial relationship with them as EnLink and Devon continue to collaborate in multiple core basins."
Through its long-term contracts with Devon, EnLink said, it will continue to maintain a strong commercial relationship with Devon while the companies work alongside each other to maximize returns in the STACK, redevelop the Barnett Shale, and team on new potential opportunities, such as crude gathering in the Delaware Basin.
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