Dallas-based LM Energy Holdings said last week it agreed to sell certain subsidiaries and assets of its Touchdown crude oil gathering system in Eddy and Lea counties in Permian Basin. The transaction with an undisclosed buyer is expected to close in 4Q and allows LM Energy to focus on its natural gas gathering systems in northern Delaware Basin. The oil gathering system in New Mexico includes more than 130 miles of pipelines and two terminals with 136,000 barrels of combined storage capacity. Volumes on the system have grown to about 75,000 b/d on a 100 percent greenfield basis.
Elliott Gerson, CEO, said Sept. 26, “This transaction positions LM as a stronger and even better capitalized company that is focused on our gas business… Gas volumes in the northern Delaware Basin continue to outperform expectations… Operators and regulators are increasing their focus on eliminating flaring. That combination creates a massive need for additional gas gathering and processing infrastructure.”
LM Energy has constructed more than 70 miles of pipelines for its gas gathering system and will commission its sixth compressor station during 4Q.