Acquisitions help power growth for Tulsa-based NGL Energy
Tulsa-based NGL Energy Partners uses water trucks and pipelines to haul produced water from storage tanks to the partnership’s processing facilities. The water is then either recycled or dumped in disposal wells deep below the surface. PHOTOS PROVIDED BY NGL ENERGY PARTNERS
NO. 1 | COMPANY HAS 23 TERMINALS IN ITS INVENTORY TULSA — Backed by 10 acquisitions over the past two years, Tulsa-based midstream partnership NGL Energy Partners soared to No. 1 on Oklahoma Inc. “Our objective was to put together a master limited partnership with multiple asset classes and segments,” CEO Michael Krimbill said. “That diversifies our risk. If one segment is doing well, that will offset any others that are not doing as well.” As it turns out, demand is strong for all of NGL Energy’s segments. NGL Energy is divided into four sections in the midstream oil and natural gas sector: crude oil logistics, water treatment services, natural gas liquids logistics and retail propane. Together, the company has 23 terminals, 4,000 rail cars, marine terminals, barges and tows. “We can go to a producer and say we can market your crude oil, we can market your liquids and we can get rid of your dirty
Adam Wilmoth
awilmoth@ opubco.com
ENERGY EDITOR
water,” Krimbill said. “We’re a bit of a one-stop shop. “We also wanted to be vertically integrated, taking product from the wellhead all the way to the end customers.” Oklahoma City money manger Greg Womack said the partnership’s use of multiple segments is an important part of why it has been so successful. “They complement each other,” said Womack, president of Womack Investment Advisers Inc. “It makes for good efficiencies of scale.” Multiple divisions also allow the partnership to grow more quickly. “When you’re acquiring as many businesses as we are, integration is always a concern,” Krimbill said.
Michael Krimbill NGL Energy Partners CEO
“With four segments, we have four separate management teams. So if we do one acquisition in each segment, even though the company has done four, each team only has to integrate one.” One of the NGL Energy’s fastest-growing segments has to do with water disposal and recycling. The partnership in September bought more wastewater disposal properties in the south Texas Eagle Ford basin for $116 million. “We can take it to distilled water quality, which is
NGL Energy Partners’ water treatment division cleans produced water to betterthan-drinking-water quality.
better than drinking water quality, and put it back into the lakes and streams. We’re the tech-heavy company in water disposal. While many in the oil and natural gas industry express concern about increasing regulation, such new rules actually benefit
NGL Energy. “To the extent that regulations demand cleaner water, we can meet whatever water quality standards the states or federal government impose.” Drilling in new oil fields and dramatically increased activity in old oil fields
have created demand for new pipelines and other methods of transportation, including rail and barges. “Having the assets we have like rail cars and barges allows us to take the right crude oil to the right end user.”