Sanchez Midstream Partners, LP. (ticker: SNMP), previously Sanchez Production Partners—a midstream subsidiary of Sanchez Energy Corporation (ticker: SN)—recently announced the sale of non-core production assets.
Sanchez will be selling its Texas production assets to a private buyer for approximately $6.3 million. The sale is expected to close in Q3, 2017.
The company also expects to close the sale of its operated Oklahoma production for approximately $5.5 million in Q3, 2017.
Gerry Willinger, CEO and general partner of Sanchez Midstream Partners, said that the sales were consistent with the “advance of [Sanchez’s] midstream strategy in South Texas,” indicating a general shift from production operations to midstream.
In keeping with the advancement of its midstream business, Sanchez announced the startup of its Raptor Gas Processing Facility in June, 2017. The facility is a 50% joint venture with Targa Resources Corp., and has a processing capacity of 200 Mmcfe per day, with a planned expansion to 260 Mmcfe per day in Q3, 2017.
The company owns the Western Catarina Midstream system in the Western Eagle Ford, has a 50% interest in the Carnero Gathering Line connected to its Western Catarina Midstream system, and has a 100% interest in the Seco Pipeline—a dry gas takeaway pipeline connected to its Raptor Gas Processing facility. The company also holds other working interests and production assets in Texas, Louisiana, and Kansas.
As of March 31, 2017, Sanchez Energy owned approximately 16% of Sanchez Production Partners’ outstanding common units, the company reported.
