Pioneer pursues divestment of EFS Midstream

Pioneer Natural Resources Company has announced that the company is pursuing the divestment of its 50.1% share of the Eagle Ford Shale Midstream business (EFS Midstream). Reliance Holding USA, Inc. owns the remaining 49.9% of the EFS Midstream business and also plans to pursue the divestment of its share in a joint process with Pioneer. Pioneer is the operator of the business.

Scott D. Sheffield, Chairman and Chief Executive Officer, stated, “The sale of EFS Midstream would allow us to strategically redeploy capital to our core, oil-rich Spraberry/Wolfcamp assets in the Permian Basin of West Texas, where we are successfully transforming the substantial resource potential we delineated in 2013 into strong production growth. We currently have no plans to divest our Eagle Ford Shale upstream assets. The sale of EFS Midstream is not expected to impact our ability to export processed Eagle Ford condensate.”

The EFS Midstream business was formed in 2010 to construct facilities to provide gathering and handling services for condensate and natural gas produced from wells on dedicated acreage in the Eagle Ford Shale. These services are provided for the Eagle Ford Shale upstream joint venture operated by Pioneer (Pioneer 46%, Reliance 45% and Newpek LLC 9%) and for various third parties.

The EFS Midstream system consists of 10 central gathering plants (CGPs) and approximately 460 miles of pipelines. The system gathers and separates produced condensate from produced gas. It also stabilises the condensate, where necessary, and treats the gas. Pioneer’s cash flow from EFS Midstream is forecasted to be over US$ 100 million in 2015.

Pioneer expects to open a data room in December.

Adapted from press release by Hannah Priestley-Eaton

Read the article online at: https://www.worldpipelines.com/business-news/05112014/pioneer-pursues-divestment-of-efs-midstream/