MPLX LP to acquire Northwind Midstream
Published by Alfred Hamer,
Editorial Assistant
World Pipelines,
MPLX LP has announced it has entered into a definitive agreement to acquire Northwind Delaware Holdings LLC (Northwind Midstream) for US$2.375 billion in cash consideration, subject to customary purchase price adjustments. MPLX intends to finance the acquisition with debt. The transaction is expected to be immediately accretive to distributable cash flow and represents a 7x multiple on forecast 2027 EBITDA. The anticipated mid-teen unlevered return is inclusive of incremental capital spend associated with in-process expansion activity.
Northwind provides sour gas gathering, treating, and processing services in Lea County, New Mexico. The portfolio includes over 200 000 dedicated acres, 200+ miles of gathering pipelines, two in-service acid gas injection (AGI) wells at 20 million ft3/d, and a third permitted well that will bring its total capacity to 37 million ft3/d. The system currently has 150 million ft3/d of sour gas treating capacity and in-process expansion activity will increase capacity to 440 million ft3/d in 2H26. The system is supported by minimum volume commitments by top regional producers.
Producers continue to demonstrate a desire to target multiple benches within the Delaware Basin for crude production. Limited sour natural gas treating and AGI well capacity, as well as the lengthy permitting process for AGI wells, has generally limited drilling activity in this area. To the extent the producers are able to address the related sour gas volumes, these areas are highly productive and profitable.
MPLX's expansion into sour gas gathering, treating, and processing in southeast New Mexico will enable prompt solutions for its existing and new producer customers. The dedicated acreage and volumes associated with this system provide access to up to 400 million ft3/d of incremental gas available for processing and up to 70 000 bpd of new NGL volumes, accelerating growth opportunities for MPLX.
"The integration of these assets with our existing Delaware basin natural gas system will expand MPLX's treating and blending operations," said Maryann Mannen, MPLX president and chief executive officer. "The addition of 200 000 dedicated acres will increase MPLX's access to natural gas and NGL volumes. The optionality to direct these new volumes through our integrated system will accelerate our growth opportunities in the Permian."
The transaction is expected to close in the 3Q25, subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
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