Kinder Morgan, Inc. has announced that its subsidiary, Hiland Partners Holdings LLC, has entered into an agreement to acquire a natural gas gathering and processing system in North Dakota from Outrigger Energy II LLC for $640 million. The acquisition includes a 270-million-cubic-feet-per-day processing facility and a 104-mile high-pressure rich gas gathering pipeline with a capacity of 350 MMcf/d. This strategic system connects gas supplies from the Williston Basin to high-demand markets and is supported by long-term contracts with major customers in the region.
“This acquisition aligns seamlessly with our existing Hiland gas assets, enabling us to aggregate additional supplies from the Bakken and expand our services to meet customer needs,” said Tom Dender, president of KMI Natural Gas Midstream.
The integration of this system enhances Kinder Morgan’s ability to provide incremental transportation and processing services while leveraging the company’s existing footprint in the area.
The acquisition is expected to deliver immediate value to KMI shareholders, with a projected 2025 adjusted EBITDA multiple of approximately 8 times on a full-year basis. This calculation excludes approximately $20 million in expected 2025 cash payments subject to deferred revenue recognition. Additionally, the transaction is anticipated to lower future capital expenditures required to support the growth of Kinder Morgan’s existing Bakken customers.
KMI plans to fund the acquisition through a combination of short-term borrowings and cash on hand.
Regulatory Approval and Closing
The transaction is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act and is expected to close in the first quarter of 2025.
Kinder Morgan’s investment in this gathering and processing system underscores its commitment to expanding infrastructure in the Williston Basin, enhancing service offerings, and creating value for its shareholders.
For more information visit www.kindermorgan.com
