Anadarko Petroleum said Thursday it will sell its remaining pipeline assets for $4 billion to its decade-old pipeline spinoff Western Gas Partners.
The Woodlands-based oil and gas producer said it is moving all of its remaining pipeline systems – primarily in West Texas’ Permian Basin and in Colorado – to Western Gas. The deal is essentially for $2 billion in cash and $2 billion in stock.
Western Gas also will merge its two publicly traded entities – Western Gas Partners and Western Gas Equity Partners – in a continuation of the industrywide trend of simplifying the structures of pipeline firms.
Anadarko will own a controlling 55.5 percent of the merged Western Gas.
“The size of this asset sale, along with the clear benefits of the simplification transaction, highlights the tremendous value of Anadarko’s midstream business,” said Anadarko Chief Executive Al Walker.
The deal is expected to close in the first quarter of 2019.
Just this summer another Houston producer, Apache Corp., decided to form its own pipeline firm with investments from a Los Angeles private equity firm. Apache is creating the new Altus Midstream with a projected market value of $3.5 billion.