Nearly three decades after co-founding Energy Transfer, Kelcy Warren is still adding to the company. The most recent example is the $7.1 billion purchase of Crestwood Equity Partners, a deal that strengthens Energy Transfer’s presence in two major oil-producing regions and pushes it into a third.
Warren, now executive chairman, discussed the company’s growth with Hart Energy, which honored him in its 50th anniversary Hall of Fame series.
What Crestwood Adds
Crestwood bolsters Energy Transfer’s large footprints in the Permian Basin and the Bakken Shale. It also extends the company into the Powder River Basin, an emerging producing area. Warren described the fit in simple terms. “They are very compatible,” he said, noting that some planned construction will be needed to connect the dots between the two systems.
Crestwood followed two other recent acquisitions. Within roughly two years, Energy Transfer also bought Enable Midstream and Lotus Midstream.
A Second Wave of Consolidation
These deals belong to the second of two big acquisition waves in the company’s history. The first came after Enron’s collapse, when pipeline assets flooded the market. The current wave is driven by growing demand for pipeline capacity as crude oil and LNG exports rise. Energy Transfer has helped lead that consolidation across the midstream sector.
The groundwork was laid earlier. Starting in 2014, Energy Transfer acquired Susser Holdings, then moved on to Regency Energy Partners, PennTex Midstream Partners, USA Compression Partners and SemGroup.
Kelcy Warren expects the buying to continue, though the pool of targets is shrinking. “But there’s still some really good assets out there that we’ve got our eyes on that we think fit us really, really well,” he said.
He also plans to expand internationally across North and South America and grow further in LNG and petrochemicals. For Kelcy Warren, a pipeline system is never finished. “If you’re a good pipeliner, you’ll never have the perfect system,” he said. Refer to this article to learn more.
Find more information about Warren on https://www.forbes.com/profile/kelcy-warren/