Energy Transfer: Crestwood Deal Looks a Bit Late to the Permian Gas Party

Energy Transfer’s $7.1 billion deal to acquire Crestwood Equity Partners looks like a decidedly mixed transaction that will ultimately be close to value neutral. Crestwood’s assets are primarily gathering and processing assets located in the Williston, Delaware, and Powder River basins, with about 3.4 billion cubic feet per day of capacity. It should close by the end of 2023. The deal follows earlier deals from peers Enterprise Products Partners and Targa acquiring similar assets (Navitas, Lucid) in the Permian, and considering the respective asset portfolios, we think Energy Transfer’s peers may have acquired better-quality assets that are more closely tied to current and future drilling activity in the Permian.