Blackstone Energy Partners to Acquire EagleClaw Midstream Ventures

  Blackstone Energy Partners to Acquire EagleClaw Midstream Ventures

Business Wire

MIDLAND, Texas -- April 17, 2017

EagleClaw Midstream Ventures, LLC (“EagleClaw”) and its financial sponsor,
EnCap Flatrock Midstream, announced today that they have entered into a
binding agreement to sell the company to funds managed by Blackstone Energy
Partners and Blackstone Capital Partners for approximately $2 billion.
Blackstone Energy Partners is the energy-focused private equity business of
Blackstone (NYSE: BX). The all-cash transaction is expected to close by the
end of July 2017 and includes approximately $1.25 billion in stapled debt
financing provided by Jefferies LLC.

EagleClaw is the largest privately held midstream operator in the Permian’s
Delaware Basin in West Texas. The company’s assets are strategically located
in Reeves, Ward and Culberson counties and include more than 375 miles of
natural gas gathering pipelines and 320 million cubic feet per day (MMcf/d) of
processing capacity with an additional 400 MMcf/d under construction.
EagleClaw serves many of the region’s leading oil and gas producers, which
have made to the company long-term dedications of natural gas volumes from
more than 220,000 acres.

EagleClaw will retain its name and operate as a Blackstone portfolio company.
The leadership team and fundamentally all of the company’s employees will
remain in their current roles and are investing alongside Blackstone in this
transaction.

CEO Perspective

“This transaction is a very exciting moment in our advancing growth story,”
said EagleClaw President and CEO Bob Milam. “I am extremely proud of our team
and grateful for our outstanding, five-year relationship with EnCap Flatrock
Midstream. We are very fortunate to have had such a great financial partner.
EnCap Flatrock brought consistent value to our strategic planning process.
They helped us navigate the opportunities and challenges of our early years
with growth capital, technical expertise, decades of commercial experience and
valuable contacts.

“As we begin a new chapter, we will continue to deliver the same outstanding
level of service our customers expect while we work with Blackstone to deploy
additional capital and to expand our footprint in the Delaware Basin.
Blackstone has a deep understanding of the compelling fundamentals of the
upstream and midstream economics in the Permian, an outstanding reputation as
an investor in the energy sector and the scale to take EagleClaw to the next
level. We are proud to have their support and look forward to a long and
successful relationship.”

From EnCap Flatrock Midstream

“We are pleased to join EagleClaw in announcing this realization,” said EnCap
Flatrock Midstream Managing Partner and Founder Bill Waldrip. “Bob Milam and
his team are to be commended for developing a world-class physical and
contractual platform in the most active basin in the country. The sale to
Blackstone will produce strong returns for our institutional investors and
rewards the EagleClaw team for many years of very hard work. We also
appreciate Blackstone’s interest and diligence in working with us to reach an
agreement that is beneficial for everyone at the table. We are confident that
Blackstone is the right partner to take EagleClaw to the next level and look
forward to watching its story evolve.”

From Blackstone Energy Partners

“Our extensive experience over the past two decades as an investor across all
segments of the energy sector, access to capital on a very large scale and
firsthand knowledge of the Permian as an owner of oil and gas producers in
this region make Blackstone uniquely well qualified to acquire EagleClaw and
to build upon the solid foundation started with the investment of Bill Waldrip
and the folks at EnCap Flatrock Midstream,” said David Foley, Senior Managing
Director of Blackstone and CEO of Blackstone Energy Partners. “Bob Milam and
his team have established excellent relationships with the leading
Permian-focused oil and gas companies. We are pleased to partner with
management to ensure EagleClaw is well positioned to continue to serve the
rapidly growing future needs of its expanding customer base, creating
additional jobs for American workers and providing significant benefits to the
economy.”

Advisers

Jefferies LLC acted as EagleClaw’s exclusive financial adviser in connection
with the transaction and was the sole provider of the committed debt
financing. The Jefferies team was led by Co-Head of Energy Investment Banking
Peter Bowden. Blackstone was advised by Trevor Heinzinger of Morgan Stanley &
Co. LLC and Skip McGee of Intrepid Partners LLC.

Frost Brown Todd LLC served as legal counsel to EagleClaw with partner Edward
W. Moore, Jr. in the lead role from the firm’s Dallas office. Thompson &
Knight LLP represented EnCap Flatrock Midstream, with partner Sarah E. McLean
in the lead role from the firm’s Houston office. Blackstone was represented by
Vinson & Elkins LLP, whose team was led by partner Keith Fullenweider.

About EagleClaw Midstream, LLC

Headquartered in Midland, Texas, EagleClaw Midstream is a midstream company
focused on developing infrastructure opportunities in the Permian Basin.
EagleClaw provides natural gas producers with a wide array of midstream
services including gathering, compression, treating, processing and
transportation. EagleClaw is led by President and CEO Bob Milam, Executive
Vice President and COO Curtis Clark, and Executive Vice President and CCO
Blake Bixler. Visit www.eagleclawmidstream.com for more information.

About EnCap Flatrock Midstream

EnCap Flatrock Midstream provides value-added growth capital to proven
management teams focused on midstream infrastructure opportunities across
North America. The firm was formed in 2008 by a partnership between EnCap
Investments L.P. and Flatrock Energy Advisors. Based in San Antonio with
offices in Oklahoma City and Houston, EnCap Flatrock is led by Managing
Partners and Founders William D. Waldrip, Dennis F. Jaggi and William R.
Lemmons, Jr., Managing Partners Gregory C. King and David J. Kurtz, and
Partner Dennis McCanless. The firm manages investment commitments of nearly $6
billion from a broad group of prestigious institutional investors. We are
currently making commitments to new management teams from EFM Fund III, a $3
billion fund.  For more information please visit www.efmidstream.com.

About Blackstone Energy Partners

Blackstone Energy Partners is Blackstone's energy-focused private equity
business, with a successful record built on our industry expertise and
partnerships with exceptional management teams. Blackstone has invested over
$12 billion of private equity globally across a broad range of sectors within
the energy industry.

Blackstone is one of the world’s leading investment firms. We seek to create
positive economic impact and long-term value for our investors, the companies
in which we invest, and the communities in which we work. We do this by using
extraordinary people and flexible capital to help companies solve problems.
Our asset management businesses, with over $360 billion in assets under
management, include investment vehicles focused on private equity, real
estate, public debt and equity, non-investment grade credit, real assets and
secondary funds, all on a global basis. Further information is available at
www.blackstone.com. Follow Blackstone on Twitter @Blackstone.

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Contact:

For EagleClaw Midstream Ventures & EnCap Flatrock Midstream:
TEN|10 Group
Casey Nikoloric
303-433-4397 x101 o | 303-507-0510 m
Managing Principal
casey.nikoloric@ten10group.com
or
For Blackstone:
Paula Chirhart
212-583-5011 o | 347-446-6570 m
Senior Vice President, Global Public Affairs
paula.chirhart@blackstone.com
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