Rangeland Energy LLC said that it has entered into a definitive agreement to sell the company to Inergy Midstream LP for $425 million. Rangeland is the owner and operator of the COLT system, the largest open-access crude oil distribution hub in North Dakota.
This could represent Inergy Midstream’s first move into the lucrative crude logistics business segment. Inergy is primarily involved in natural gas liquids and natural gas storage and transportation, according to the company’s website.
The COLT system includes a large crude oil rail loading terminal in Williams County, N.D., and related storage and pipeline assets. The transaction is expected to close in early December.
Founded in 2009, Rangeland is a midstream energy company led by a management team and backed by private equity commitments from EnCap Flatrock Midstream of San Antonio. Rangeland’s management team will retain the company name and continue to pursue midstream development opportunities across North America.
The COLT system is located in the heart of the Bakken and Three Forks shale oil producing region. The system’s components include the COLT Hub, the COLT Connector and the Dry Fork Terminal. The COLT Hub serves as a point of liquidity for the distribution of Bakken crude oil throughout North American markets by providing customers with crude oil storage and connectivity to BNSF Railway Company and various inbound and outbound pipeline systems.
The terminal was placed in service in early May 2012. The COLT Hub serves crude oil refiners, marketers and producers and has contracted aggregate volume commitments of approximately 150,000 b/d of crude.
The COLT Connector is a 21-mile bidirectional pipeline that connects the COLT Hub to the Enbridge and Tesoro pipelines at Rangeland’s terminal at Dry Fork near the Beaver Lodge/Ramberg junction, the Banner gathering system and a planned connection to the Bear Tracker Energy gathering system.
Construction of the COLT Hub began in May 2011. With six 120,000-bbl storage tanks and two 8,700-foot rail loops, the COLT Hub accommodates large 120-car unit trains.
Under terms of the agreement, all of the Rangeland employees working in North Dakota will be invited to work for Inergy.