Matador to Sell Pronto Midstream Stake for $600 Million to San Mateo JV
(P&GJ) — Matador Resources has agreed to sell its wholly-owned subsidiary, Pronto Midstream, to San Mateo Midstream, a joint venture where Matador holds a 51% stake.
The deal values Pronto at around $600 million. Matador will receive an upfront cash payment of approximately $220 million and could earn up to $75 million more in performance incentives over the next five years as it develops assets in northern Lea County, New Mexico.
Matador plans to use the proceeds to reduce its outstanding debt. The company expects its leverage ratio to drop to about 1.1 times by the end of 2024. The transaction, pending customary approvals, should close by the end of this year.
As part of the agreement, Matador and Pronto will handle natural gas gathering and processing for Matador’s operations in Lea County. Northwind Midstream Partners, affiliated with San Mateo's co-owner Five Point Energy, will manage sour gas treatment. Pronto's Marlan Processing Plant, currently being expanded, will increase its capacity from 60 million to 260 million cubic feet per day by mid-2025.
Matador CEO Joseph Foran said the deal strengthens San Mateo’s presence in Lea County, offering "additional scale and expansion" opportunities. He added that proceeds from the sale would help repay debt and enhance midstream operations.
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