Permian producer Callon finds midstream asset management group

By Luke Geiver | October 12, 2017

Pure-play Permian Basin exploration and production company Callon Petroleum Co. has found a new entity to manage its midstream infrastructure. Through a deal with Brazos Midstream Holdings LLC, Callon’s existing gas gathering and processing infrastructure will now be owned and managed by Brazos.

Brazos and Callon have agreed to a long-term, fee-based agreement to move and process gas produced in the Texas Counties of Ward and Pecos, both situated in the core of the Southern Delaware Basin. The agreement gives Brazos 240,000 acres operated by Permian producers.

Joe Gatto, CEO and president of Callon, said the transaction will help the company focus on robust growth across its Delaware Basin footprint.

“Callon is one of the leading pure-play Permian operators and we are pleased to be able to manage their gas infrastructure needs,” said Stephen Luskey, CCO of Brazos. Luskey added that the Delaware Basin is one of the most promising region’s in the entire midstream services industry.

Through the purchase of Callon’s gathering and storage assets, Brazos can now connect to the Comanche II natural gas processing plant—expected for completion in 2018. In addition to that plant, Brazos has already secured a site for an additional gas processing plant—the Comanche III—that will begin construction in early 2018.