Ares Management and ARM Energy Holdings Announce Partnership to Develop Salt Creek Midstream in the Delaware Basin
16 April 2018 - 8:30PM
Business Wire
Funds Managed by Ares Have Provided Substantial
Equity Commitment to Pure-Play Delaware Basin Midstream Company
Ares Management, L.P. (NYSE:ARES) (“Ares”) and ARM Energy
Holdings, LLC (“ARM Energy”) today announced a partnership to
develop Salt Creek Midstream, LLC (“Salt Creek” or the “Company”)
in the Delaware Basin. The Company is owned by funds managed by the
Ares Private Equity Group and ARM Energy. ARM Midstream Management,
LLC, a subsidiary of ARM Energy, will serve as operator of the
project.
Once fully operational, Salt Creek will primarily be comprised
of multiple cryogenic processing facilities, as well as gas and
crude gathering pipelines, compression and treating facilities. The
initial phase of the project is expected to be commissioned in
April 2018, and by the end of 2018, Salt Creek is expected to have
260 million cubic feet per day of processing capacity, with
additional expansion investments planned as producers are added to
the system.
To date, Salt Creek has secured commitments for more than
250,000 dedicated acres from multiple Delaware Basin producers,
which the Company expects will provide decades of high-return
drilling inventory, driving additional project growth and scale in
a rapidly expanding basin.
ARM Energy’s CEO Zach Lee said, “We are thrilled to partner with
Ares on this important initiative, and are confident it will create
long-term value for ARM Energy, Ares and our other partners. ARM’s
downstream intelligence and in-depth fundamentals analysis provided
us with the insight to identify Salt Creek as a unique midstream
offering for Delaware Basin producers as we continue to build
world-class midstream assets spanning the entire basin, as well as
downstream market solutions for residue gas, NGLs and crude. We
believe the rapid development of the Salt Creek project, on the
heels of our successful development and sale of Kingfisher
Midstream, demonstrates our agility, efficiency and integrated
approach in evaluating and capitalizing on market
opportunities.”
Ares’ Nate Walton, Partner and Co-Head of North American Private
Equity, said, “Ares is excited to collaborate with the ARM Energy
team on Salt Creek Midstream, which is located in one of the most
prolific energy plays in North America. We believe that this
company will benefit from the combination of our industry
experience and long-term relationships in the sector as well as
ARM’s extensive midstream, downstream and marketing knowledge.”
Salt Creek Midstream, LLC also announced the successful close of
its $350 million term loan facility. Deutsche Bank acted as sole
arranger and underwriter of the credit facility, the proceeds from
which will be used to fund further development and expansion of the
project in the Delaware Basin. Key phases of Salt Creek’s
development plan will continue to enter service throughout
2018.
About Salt Creek Midstream, LLC
Formed in 2017, Houston-headquartered Salt Creek Midstream, LLC
is a joint venture of ARM Energy Holdings LLC and funds managed by
Ares Management, L.P. Salt Creek is a full service midstream
provider, offering gas and crude gathering, compression, cryogenic
processing and treating services. The greenfield development
project spans more than 250,000 acres across Culberson, Reeves,
Ward, Winkler, Lea, Pecos, and Eddy Counties within the Delaware
Basin.
About Ares Management, L.P.
Ares Management, L.P. is a publicly traded, leading global
alternative asset manager with approximately $106.4 billion of
assets under management as of December 31, 2017 and 18 offices in
the United States, Europe, Asia and Australia. Since its inception
in 1997, Ares has adhered to a disciplined investment philosophy
that focuses on delivering strong risk-adjusted investment returns
throughout market cycles. Ares believes each of its three distinct
but complementary investment groups in Credit, Private Equity and
Real Estate is a market leader based on assets under management and
investment performance. Ares was built upon the fundamental
principle that each group benefits from being part of the greater
whole. For more information, visit www.aresmgmt.com.
About ARM Energy Holdings, LLC
Headquartered in Houston, with offices in Calgary, Denver,
Midland, and Pittsburgh, ARM Energy is a premier producer services
firm, active in every sector of the energy value chain across all
major North American oil and gas basins. Its integrated,
diversified portfolio includes Asset Risk Management, LLC,
providing risk management and hedging strategies for producers; ARM
Energy Management LLC, providing physical oil and gas marketing,
transportation and asset management services and trading; and ARM
Midstream, LLC, providing midstream investment, infrastructure
development and operations. www.armenergy.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20180416005485/en/
For Ares ManagementMedia:Mendel CommunicationsBill Mendel,
212-397-1030bill@mendelcommunications.comorInvestors:Ares
Management, L.P.Carl Drake, 800-340-6597cdrake@aresmgmt.comorFor
ARM Energy:Sard Verbinnen & CoKelly Kimberly,
+1-832-680-5120kkimberly@sardverb.comorPaul Frankle,
+1-415-618-8750pfrankle@sardverb.com
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