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ARM Midstream and HPS Investment Partners Announce Additional Expansion of Kingfisher Midstream System

Company delivers value to additional STACK producers via Western Expansion project and incremental residue gas takeaway

HOUSTON, Dec. 21, 2016 /PRNewswire/ — ARM Energy (“ARM”), a wholly-owned subsidiary of Asset Risk Management, and HPS Investment Partners, LLC (“HPS”), a leading global investment firm, today announced that Kingfisher Midstream (“KFM”), a natural gas gathering and processing system and crude oil gathering system in Oklahoma’s STACK play, is expanding from its original footprint in Kingfisher County into Blaine and Major County. KFM has also secured incremental residue gas takeaway to markets outside the state of Oklahoma. In recent months, the increased drilling activity in the STACK and SCOOP regions have caused residue gas takeaway markets to tighten significantly.

Kingfisher Midstream is now backed by long-term acreage commitments from six producers in the STACK. Beginning in Q2 2017, the project will have 260,000 MCFD of processing capacity at the Lincoln Plant site, all of which is matched by firm residue gas transportation to downstream markets.

“Our team and partners are excited with the continued progress and advancement of KFM’s midstream operations in Kingfisher,” said Zach Lee, Chief Executive Officer, ARM. “ARM’s and HPS’ vision for the project continues to develop as more and more producers connect to the system and seek a first-rate gathering and processing system. The residue capacity secured by KFM ensures that our producers will be well positioned to grow their production as STACK development continues.”

“ARM has been a great operating partner, strategically securing takeaway capacity, expanding the gathering footprint and connecting third party producers,” said Don Dimitrievich, a Managing Director at HPS. “We are excited to be a part of KFM’s continued growth and expansion efforts, which reflect HPS’ continued support for the project as well as our focus on investing in midstream assets in top-tier basins, such as the STACK.”

KFM includes a natural gas gathering and processing system as well as a crude gathering system. Construction on the system began in September 2015 and commercial operations started in June 2016. Since June, KFM has focused on serving producers in new and developing parts of the STACK play and continuing to secure firm residue markets.

“We continue to put the right tools in place to best serve our existing and potential new customers in the region,” said Taylor Tipton, President, ARM. “KFM’s processing, transport, and market connectivity continue to provide its producers with flow assurance and the best netbacks in the region. With the support of our operating team and the support of our strong capital partner, HPS, KFM is well positioned to meet producers’ needs as they grow across the STACK.”

The Western Expansion will add an additional 50 miles of high pressure and low pressure gathering pipeline to the existing system, which already includes more than 250 miles of high- and low-pressure gas gathering pipeline, more than 100 miles of crude gathering, six crude oil truck loading stations, a 50,000 bbl crude storage facility and condensate stabilization systems, making it the largest private midstream operator in the STACK.


About ARM Energy
ARM is an independent producer services company that provides solutions through financial hedging advisory, physical marketing, and midstream initiatives. ARM delivers value to its clients by identifying and capturing potential market upside and de-risking producers’ natural commodity long positions across all of its service lines. ARM Energy Management (“AEM”) markets crude oil/condensate, natural gas, and natural gas liquids for more than 125 producer clients in all major producing basins throughout the United States. ARM leverages its staff’s industry knowledge and experience to deliver a wide variety of reliable and competitively-priced energy marketing and management services and tangible value to its clients. The Company and its predecessors have operated multiple midstream assets in PennsylvaniaTexas, and Louisiana since 2009.  ARM has corporate headquarters in Houston and offices in PittsburghDenver, Calgary, Oklahoma City, and Midland. For more information, please visit www.armenergy.com.

About HPS Investment Partners, LLC
HPS Investment Partners, LLC (“HPS”) is a leading global investment firm with a focus on non-investment grade credit. Established in 2007, HPS has approximately 100 investment professionals and over 200 total employees and is headquartered in New York with ten additional offices globally. HPS was originally formed as a unit of Highbridge Capital Management, LLC, a subsidiary of J.P. Morgan Asset Management, and was formerly known as Highbridge Principal Strategies, LLC. In March 2016, the principals of HPS acquired the firm from J.P. Morgan, which retained Highbridge’s hedge fund strategies. As of December 2016, HPS has approximately $34 billion of assets under management and since inception has invested over $3.5 billion in the energy and power industries.


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