GMX Resources Inc. (GMXR) recently agreed to sell a 40% interest in its gas gathering and compression business to Kinder Morgan Energy Partners L.P. (KMP) for $36 million. The closing of the transaction is subject to customary closing conditions and is expected to conclude in early November.
This transaction will fund GMX’s addition of a second rig to the Haynesville/Bossier Shale horizontal drilling program. The salt water disposal assets and other poly pipelines will not be part of the transaction and will continue to be wholly owned by Endeavor Pipeline Inc., a wholly owned subsidiary of GMX Resources.
The gas gathering and compression business provides gathering services to the company in its Cotton Valley Sands and Haynesville/Bossier Shale horizontal developments in East Texas. It will provide funding for future infrastructure needs to support GMX’s anticipated production growth.
Separately, GMX said its second FlexRig 3 rig from Helmerich & Payne Inc. is in transit and will start the company’s eleventh horizontal well in the Haynesville/Bossier Shale.
GMX said that partnering with Kinder Morgan in the midstream business will also give it access to additional capital for midstream growth.
GMX Resources Inc is a ‘pure play’ exploration and production (E&P) company with one of the most leveraged Haynesville/Bossier Horizontal Shale Operations in East Texas. The company, together with its subsidiaries, engages in the exploration, development and production of properties for the production of crude oil and natural gas in Texas, Louisiana and New Mexico.
Kinder Morgan Energy Partners L.P. is a leading pipeline transportation and energy storage company in North America. One of the largest publicly traded pipeline limited partnerships in America, Kinder Morgan has an enterprise value of approximately $25 billion.
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