on Point Agrees to Sale With Gravity

On Point Oilfield Holdings LLC ("On Point"), a portfolio company of White Deer Energy, L.P ("White Deer"), announced today that is has recently executed a definitive agreement to sell its industry leading Permian Basin produced water midstream business to Gravity ("Gravity"). 

Since its inception in October 2016, On Point has quickly grown into the largest operator of produced water disposal by volumes in the Midland Basin. On Point was able to meet the growing demand for reliable water infrastructure from its long-term contracted E&P customers by pioneering the development of new deep Ellenberger disposal wells and pipelines in certain undeveloped areas of the Howard, Martin, and Midland counties faster than any other company in the Permian. On Point's current system includes 17 active disposal wells with 432,500 barrels per day of permitted capacity connected to over 130 miles of pipeline infrastructure, as well as the rights to develop up to 20 new deep Ellenberger disposal permits for an additional 425,000 barrels per day of capacity to grow its systems and meet future market demand.

Gravity, a portfolio company of Clearlake Capital Group, L.P. ("Clearlake"), plans to integrate the On Point system with its existing water infrastructure platform to create the largest produced water gathering and disposal company in the Midland Basin.  Upon consummation of the acquisition, On Point co-founder & CEO Trace Hight has agreed to join Gravity as its Chief Commercial Officer of Water Infrastructure. On Point's co-founder & COO McCabe Turner and Vice President of Operations Mike Christensen have also agreed to new contracts with Gravity to continue to grow the newly expanded water midstream platform.  

"McCabe, Mike, and I are very excited about the acquisition by Gravity and the opportunity to join a team focused on expanding our industry leading produced water midstream infrastructure in the core areas of Howard, Martin, and Midland counties," said Trace Hight.  "Our deep Ellenberger disposal wells and pipelines combined with Gravity's water infrastructure expertise will help ensure we continue to satisfy market growth from our E&P customers and remain the market leader in the Midland Basin."

Jim Meneely, Partner at White Deer, stated, "It was a pleasure to partner with Trace, McCabe, and the rest of the On Point management team.  They successfully transitioned the company from a collection of truck-fed disposal wells to an industry leading pipeline-connected midstream system backed by valuable long-term contracts."

On Point and White Deer were advised by Tudor, Pickering, Holt & Co and Locke Lord, LLP. Gravity was advised by Vinson and Elkins.

Source: On Point Oilfield Holdings LLC
Date: Nov 7, 2019