Sugar Land-based Rangeland Energy announced Monday it has entered into an agreement to sell the company’s assets, including its open-access crude oil distribution hub in North Dakota and related storage and pipeline assets, to Inergy Midstream for $425 million.
The deal is expected to close in early December, according to Rangeland.
Rangeland’s management team will retain the company name and continue to pursue midstream development opportunities across North America.
Rangeland formed in 2009 to develop midstream infrastructure in the Bakken. It is backed by private equity firm EnCap Flatrock Midstream of San Antonio.
Its distribution hub in Williams County, North Dakota is in the heart of the Bakken and Three Forks shale oil region, which some estimates predict will produce 2.1 million barrels of oil a day by 2025.
Rangeland CEO Chris Keene said in a statement that Kansas City-based Inergy will be able to grow the business.
“We started with a piece of paper and a vision and now, just three years later, (the system) is well positioned to be the premiere crude oil terminal in the Bakken,” he said.
Construction of the hub began in May 2011. It includes six 120,000-barrel storage tanks and two 8,700-foot rail loops, allowing it to accommodate large 120-car unit trains and can move more than 120,000 barrels of crude oil per day, according to the company.
In addition, the hub can transport an additional 70,000 barrels per day by pipeline.
The system serves four large crude oil refiners and marketers, including Tesoro Corporation and Flint Hills Resources, according to Rangeland.
The agreement with Inergy calls for all Rangeland employees in North Dakota to be invited to work for Inergy.