Summit Midstream announces US$90 million acquisition of Moonrise Midstream

Highlights

• Expands Summit's gathering and processing footprint in the DJ Basin with ~80 miles of natural gas gathering pipeline, ~25 miles of crude oil gathering pipeline and 65 million ft³/d of additional processing capacity, expandable to ~100 million ft³/d with modest capital investment.
• Provides Summit's DJ Basin customers with additional processing capacity, redundancy and flow assurance, while positioning Summit to handle sizeable volume growth expected in the future in a capital-efficient manner.
• Represents the continuation of Summit's corporate consolidation strategy, building scale through strategic, bolt-on acquisitions in key basins where Summit can drive additional value through commercial and operational synergies.
• Value-accretive acquisition multiple of approximately 5.0x 2024 Adjusted EBITDA.
• Transaction structure includes US$70 million of up-front cash, which is leverage-neutral, representing ~3.9x 2024 Adjusted EBITDA.
• Creates commercial and operational synergies, commercial upside and additional in-basin consolidation opportunities.

Heath Deneke, President, Chief Executive Officer and Chairman, commented, "We are pleased to announce the successful completion of this strategic bolt-on acquisition that further enhances our position in the DJ Basin. This acquisition not only expands our footprint and dedicated acreage in one of the most active areas of the DJ Basin but also provides incremental processing capacity that we expect to utilise in the coming years as volumes behind our legacy systems continue to grow. Following the acquisitions of the Outrigger and Sterling systems in December 2022, we have experienced significant volume growth behind our integrated DJ gathering and processing system and certain areas of our system are nearing full utilisation. As a result of the limited available system capacity, some of our customers have deferred development activity behind our system in 2025. There are currently three rigs running behind our dedicated acreage position in the DJ and two of our key customers have sizeable multi-year development plans beginning in 2026. Moonrise adds 65 million ft³/d of processing capacity, approximately half of which is expected to be available to help alleviate our integrated DJ system constraints and enable our customers to continue to increase activity and grow volumes in 2026 and beyond.

“Summit is already operationally connected to the Moonrise system through multiple existing interconnections, and we expect to capture significant operational and commercial synergies with the combined systems. The expanded pipeline footprint will alleviate localised pipeline constraints on the northern end of our system and enable Summit to optimise capital expenditures as development shifts further north. With additional and expandable processing capacity at Moonrise, we will be able to further improve our plant operating margins, reduce reliance on third-party offloads, increase our overall system reliability and flow assurance, and optimise NGL recoveries, which will benefit both Summit and our customers. We remain extremely excited about the long-term opportunities in the DJ Basin as our customers continue to execute their development programs, with more than 800 dedicated undeveloped locations and sizable acreage positions in the area that Summit is very well-positioned to serve with the combined systems."

 

 

Read the latest issue of World Pipelines magazine for pipeline news, project stories, industry insight and technical articles.

World Pipelines’ March 2025 issue

The March 2025 issue of World Pipelines includes a keynote section on hydrogen pipeline transport, and technical articles on pipeline construction, protecting pipeline coatings, corrosion under insulation, GIS and pipeline integrity management, and flow assurance.

Read the article online at: https://www.worldpipelines.com/business-news/11032025/summit-midstream-announces-us90-million-acquisition-of-moonrise-midstream/