Texas-based TLLP will buy all of QEPM that it does not already own for US$2.5 billion in a unit-for-unit exchange. The deal, which is expected to close this year, will expand TLLP’s reach in the Rocky Mountains and North Dakota by adding more than 2000-mi. of pipelines capable of carrying more than 54,000 b/d of oil and 2.9 Bcf/d of gas.
“The large increases in domestic crude oil and natural gas production are driving significant infrastructure investments,” says Gregory Goff, TLLP chairman and CEO.
The buyout is subject to final approval by QEPM unitholders and regulators. QEPM shareholders will receive 0.3088 TLLP common units for each unit of QEPM that they hold. The units are valued at $17.09 each, based on TLLP’s closing price of $55.34, a premium of 8.5% over last December’s proposal.
TLLP already owns nearly 56% limited partner interest in QEPM, and 100% of the limited liability company interests of QEPM GP, the latter of which holds a 2% general partner interest, as well as 100% of the incentive distribution rights in QEPM.
TLLP operates primarily in the western and Mid-Continent regions of the US, and owns and operates a network of more than 3500 mi. of crude oil, refined products and natural gas pipelines.
QEPM is a master limited partnership formed to own, operate, acquire and develop midstream assets. The partnership provides midstream gathering and processing services to companies operating in the Green River, Uinta and Williston basins.