Select Water Solutions, Inc. (NYSE: WTTR) (“Select” or the “Company”), a prominent supplier of sustainable water and chemical solutions to the energy sector, has revealed the purchase of key water infrastructure assets in the Haynesville Shale and Rockies regions for an estimated $90 million in total cash consideration.
These acquisitions will contribute about 450,000 barrels per day of authorized disposal capacity to Select’s Water Infrastructure segment, encompassing 21 active saltwater disposal wells, two slurry injection wells, a solids treatment facility, and numerous approved permits for additional recycling and disposal facility development.
The operational disposal activities are backed by a substantial portfolio of interconnected gathering pipelines, strategic surface acreage and right-of-way, and multiple long-term pipeline gathering and dedication contracts.
John Schmitz, Chairman of the Board, President and CEO, commented, “Select is the leader in providing comprehensive water solutions to address the increasing demand for long-term produced water management in the energy industry, and our recent acquisitions reinforce this position. The three acquisitions will bring additional contracted revenue and earnings potential to our Water Infrastructure segment and strategically complement our existing water infrastructure networks in the Haynesville Shale and Rockies regions. With the additions of Iron Mountain and Tri-State Water’s disposal operations, we have a tremendous opportunity to efficiently integrate these assets into our existing 60-plus mile gathering pipeline system in the Haynesville Shale, expanding our overall water handling capacity and extending the geographic footprint of the network. Furthermore, the addition of the slurry and solids treatment facilities expands the scope of Select’s capabilities in the region, broadening our full life-cycle waste stream management capabilities for our customers and adding incremental value across our proforma position in the Haynesville”
“In the Rockies, our latest addition provides long-term contracted produced water streams and disposal solutions, with approximately 85% of the volumes received in 2023 covered under long-term contracts. When coupled with our current recycling capabilities in the Rockies, the additional permitted recycling capacity from this acquisition will enhance our ability to provide expanded comprehensive produced water management solutions to our customers. Not only do these acquisitions fit our near-term strategy to grow and expand our production-based and contracted revenues within our Water Infrastructure segment, but they provide further development potential for two of our critical regional infrastructure networks. Expanding and further integrating these recycling, disposal and pipeline networks provides financial and environmental benefits to our customer and the communities where we operate. Just as importantly, these acquisitions create immediate shareholder value as they are financially accretive on a per share basis for both free cash flow and net income. We look forward to providing additional visibility and forward-looking statements around the transactions on our upcoming earnings call,” concluded Mr. Schmitz.
Source : Select Water Solutions
