More Petrohawk-Style Midstream Deals Coming for the HS Play?

Not surprising that Petrohawk has leveraged its position in the HS play by monetizing its midstream assets to Kinder Morgan - I expect other smaller to mid-sized players to follow suit, maybe even a couple of additional big players. 

 

What better way to raise cash than to sell existing gathering assets, plus dedicate an additional large block of soon-to-be-developed acreage, and establish healthy gathering and processing/treating fees to support a large cash offer from a large midstream player such as KM?  It will be interesting to see what type of discounted  " % of index-type " deals are structured between the producer and the marketing arms of these big midstream companies to effectively reduce infrastructure cost by pass-through of a portion of such cost to the mineral/royalty owner at the wellhead (when not specifically restricted under lease provisions).   

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Permalink Reply by jffree1 on April 13, 2010 at 5:14
press release

April 13, 2010, 6:00 a.m. EDT · Recommend (1) · Post:
Kinder Morgan to Purchase 50% of Haynesville Shale Midstream Operations for $875 Million
Joint Venture with Petrohawk Creates Leading Midstream System in the Haynesville Shale

http://www.marketwatch.com/story/kinder-morgan-to-purchase-50-of-ha...
Permalink Reply by Les Bamburg on April 13, 2010 at 7:29
Mattie, not many deals left as most producers do not have the same infrastructure as Petrohawk. EnCana/Shell already has deal with Centerpoint. Chesapeake is still in the hunt.

By the way, the services are more likely to be straight fee & fuel transactions since Haynesville/Bossier Shale does not offer any processing opportunities.
Permalink Reply by Mattie on April 13, 2010 at 7:37
Yes, I forgot about the Centerpoint deal with Shell/Encana - but, the CHK deal could be big - of course, they've been recently touting their growth in the midstream sector, but my take on that promotion is to set it up later for sale or partnership with a 3rd party gatherer and extract value.

i wasn't thinking much on the processing side, mainly treating, which as you know is it's own niche.

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