The strategic shuffling in energy infrastructure continued apace Tuesday (Sept. 2) with the $1.57 billion acquisition by Plains All American Pipeline of a 55 percent non-operating interest in EPIC Crude Holdings, the entity that owns and controls the EPIC Crude Oil Pipeline.
Plains is acquiring the majority interest held jointly by Diamondback Energy and Kinetik Holdings Inc. The remaining 45 percent is owned by Ares Management, which operates the pipeline and will continue to do so after the expected Q1 2026 closing.
The all-cash deal includes $600 million of debt and an additional potential earnout of $193 million should a planned expansion to 900,000 barrels per day of capacity be approved before year-end 2027. Current capacity is rated at 600,000 bpd.
Plains All American was advised by Latham & Watkins, Diamondback by Akin Gump and Kinetik by Vinson & Elkins.
Assets involved include 800 miles of crude oil pipeline connecting the Permian Basin in West Texas and the Eagle Ford Shale with terminals on the Corpus Christi Bay, as well as 7 million barrels of storage and over 200,000 bpd of operational export capacity.
Willie Chiang, chairman and CEO of Plains, cited the integration of EPIC to Plains All America’s existing midstream assets as a major reason for the move.
“By further linking our Permian and Eagle Ford gathering systems to Corpus Christi, we are enhancing market access and ensuring our customers have reliable, cost-effective routes to multiple demand centers,” Chiang said, noting that the deal will be financed within the parameters of Plains’ current balance sheet.
The Latham team advising Plains was led by Houston partners Ryan Lynch and Nick Dhesi, with associates Clayton Heery, Morgen Seim, and David Lee. Houston partners Tim Fenn and Jared Grimley advised on tax matters. Washington, D.C., partners Jason Cruise and Caitlin Fitzpatrick with associate Mary Casale on antitrust; partner Pat Nevins and Jecoliah Williams on antitrust; Los Angeles partner Josh Marnitz with associate Kate Johnstone; benefits partner Adam Kestenbaum, with associate Sam Sturgis; and counsel Natalie McFarland, with associate Kara Burkett on finance.
Akin advised Diamondback with a team led from Houston by corporate partners John Goodgame and Leana Garipova. The team also included included energy associates Hailey Marino and Paxton Merrill from Houston; tax partner Alison Chen and associate Samir Halawi from Houston; and antitrust partner Brian Rafkin and counsel Alexander Rosselli from Washington, D.C.
Counseling Kinetik was a Vinson & Elkins led from Houston by partner Robert Hughes and senior associates David Lassetter and Chandler Jones, with assistance from associates Terrence Ogren and Shiyuan Wang. Also advising were partners Brian Russell in Dallas and John Lynch in Houston with associate Paige Melton in Dallas on tax; partners Hill Wellford and Evan Miller, both on anti-trust issues from Washington, D.C.; Denver-based partner Jennifer Cornejo and Matthew Dobbins in Houston with associate Alexis Boyd on environmental issues; and partner Shane Tucker and associate Matthew Green from Dallas on employment and compensation.