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Enable's results show positive effects from deal to acquire oil gatherer in Anadarko Basin

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This map shows areas inside the Anadarko Basin dedicated to being served by Enable Midstream Partners. The green dots represent rigs dedicated to producers who have contracts with Enable Midstream. The black dots represent other operating rigs in the basin. [PROVIDED BY ENABLE MIDSTREAM PARTNERS]
This map shows areas inside the Anadarko Basin dedicated to being served by Enable Midstream Partners. The green dots represent rigs dedicated to producers who have contracts with Enable Midstream. The black dots represent other operating rigs in the basin. [PROVIDED BY ENABLE MIDSTREAM PARTNERS]

Enable Midstream Partners LP’s deal to acquire a crude oil and condensate gathering system in the Anadarko Basin paid off when it came to its first-quarter operational results and earnings.

Officials said the $442 million deal it made to buy a system developed by Velocity Holdings, announced in October, quadrupled the amount of oil and condensate it gathered during the period, compared to the same time the year before.

“Prior to our Velocity acquisition, we principally were a gas gatherer and processor in Oklahoma,” said Rod Sailor, Enable’s president and CEO. “But we had wanted to expand our product suite in Oklahoma to include crude gathering for some time.

“It was important because all of the producers in the Anadarko Basin are drilling for crude."

Sailor said Enable, which operates the largest gas gathering system across the basin, watched closely as Velocity started working to grow its oil gathering business in the field with many of the same customers Enable was already serving.

“When that system came to market, we were very aggressive in trying to acquire it,” he said.

Sailor said the Velocity crude gathering system is attractive to producers because it provides them a way to get oil directly to a nearby refinery.

He said the system under Enable’s ownership also provides producers with less hassle because they need only negotiate with one firm to provide both oil and natural gas gathering services.

Producers on more than 2 million acres across the basin have dedicated their production to Enable’s gas gathering system, while many area producers previously had dedicated their acreage to Velocity for oil production before Enable purchased the firm.

The company also reported year-over-year, first-quarter increases in the amount of natural gas it gathered and processed, and a 25% increase in the amount of natural gas liquids it produced, using the same comparison.

Officials attributed that increase to the higher amounts of processed natural gas, plus increased recoveries of ethane from the product stream.

Financially, the company earned a first quarter net income of $113 million, or 26 cents a share, on revenues $795 million, compared to $105 million, or 24 cents a share, on revenues of $748 million during the same quarter in 2018.

The company’s adjusted earnings before interest, taxes, depreciation and amortization was $297 million in the first quarter of 2019, compared to $257 million the same time a year earlier.

Not all the gains in gathered oil and condensates were generated by Enable’s acquisition of the Velocity system. The company also boosted the amount of oil and condensates it gathered in the Williston Basin.

Natural gas gathered volumes increased to about 4.5 billion cubic feet per day, up 6% compared to the same time in 2018. It increased natural gas processed volumes to about 2.5 billion cubic feet per day during the first quarter and produced about 138,000 barrels of natural gas liquids during the quarter.

Enable also continues to benefit from ongoing efforts to drill and produce wells in the Anadarko, Ark-La-Tex and Williston Basins. Officials said Wednesday 52 rigs were drilling wells on April 24 that Enable expects will be served by its gathering systems in those plays.

They noted the count of operating drilling rigs in the Anadarko Basin was at its highest level since the first quarter of 2015, and that exploration and production companies are continuing to get strong production results from completed wells.

Sailor stated in the release that the company’s first quarter results continue to show the quality of its assets, operational capabilities and capital investment decisions.

“As 2019 unfolds, we believe our focus on delivering unique service offerings and results through safe and reliable operations offers a compelling value to both customers and investors,” he said.

Related Photos
<strong>Rod Sailor</strong>

Rod Sailor

<figure><img src="//cdn2.newsok.biz/cache/r960-875cfc0e9d26a217b2bf885d2e99b9ba.jpg" alt="Photo - Rod Sailor " title=" Rod Sailor "><figcaption> Rod Sailor </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-842667a14df498934c478f6e3014ff74.jpg" alt="Photo - This map shows areas inside the Anadarko Basin dedicated to being served by Enable Midstream Partners. The green dots represent rigs dedicated to producers who have contracts with Enable Midstream. The black dots represent other operating rigs in the basin. [PROVIDED BY ENABLE MIDSTREAM PARTNERS] " title=" This map shows areas inside the Anadarko Basin dedicated to being served by Enable Midstream Partners. The green dots represent rigs dedicated to producers who have contracts with Enable Midstream. The black dots represent other operating rigs in the basin. [PROVIDED BY ENABLE MIDSTREAM PARTNERS] "><figcaption> This map shows areas inside the Anadarko Basin dedicated to being served by Enable Midstream Partners. The green dots represent rigs dedicated to producers who have contracts with Enable Midstream. The black dots represent other operating rigs in the basin. [PROVIDED BY ENABLE MIDSTREAM PARTNERS] </figcaption></figure>
Jack Money

Jack Money has worked for The Oklahoman for more than 20 years. During that time, he has worked for the paper’s city, state, metro and business news desks, including serving for a while as an assistant city editor. Money has won state and regional... Read more ›

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