Golden Gate Capital has formed Stonehill Environmental Partners, a provider of energy infrastructure solutions to the upstream energy industry. No financial terms were disclosed. Also, Golden Gate has acquired the assets of Waterfield Midstream, a provider of midstream infrastructure solutions in the Permian Basin. No financial terms were disclosed. Tudor, Pickering, Holt & Co. was financial advisor to Golden Gate Capital and Stonehill while Weil, Gotshal & Manges LLP served as legal counsel.
Golden Gate Capital, a leading private equity investment firm, today announced the formation of Stonehill Environmental Partners (“Stonehill” or “the company”), led by CEO Jay Parkinson, a long-time energy industry veteran and former Golden Gate Capital Operating Executive. With over $19 billion in cumulative committed capital, Golden Gate Capital is differentiated by its unique perpetual fund structure, enabling the firm to make long-term investments without liquidity constraints. Golden Gate will be Stonehill’s anchor investor as it grows its infrastructure platform.
Stonehill provides energy infrastructure solutions to the upstream energy industry by designing, building, owning and operating fixed water pipeline, recycling and disposal assets that maximize efficiency and reduce the environmental footprint for oil and gas industry customers’ operations. The company will pursue both organic and inorganic growth strategies to facilitate scale expansion. M&A opportunities will include standalone assets, as well as monetizing existing E&P-owned water infrastructure assets, providing E&P companies the opportunity to re-deploy capital to core drilling and completion activities.
Golden Gate Capital also announced the acquisition of the assets of Waterfield Midstream, a provider of midstream infrastructure solutions in the Permian Basin. Waterfield Midstream currently services Martin County in the Midland Basin behind long-term acreage dedication contracts with permitted disposal capacity of approximately 250,000 barrels per day. The addition of the Waterfield Midstream assets, which will be rebranded as Stonehill and integrated into the company, marks the first acquisition in the Stonehill platform.
“We are excited for the opportunity to once again partner with Dave Thomas and the rest of the terrific Golden Gate Capital team as we look to aggressively build out a larger water midstream pipeline and disposal system,” said Mr. Parkinson. “We are confident that Golden Gate Capital’s industry expertise and commitment to continued investment in both inorganic and organic growth opportunities will help establish Stonehill as a leader in providing environmentally friendly, efficient water solutions.”
“We have an outstanding relationship with Jay and the highly-respected Stonehill team, and are delighted to work with them again,” said Dave Thomas, a Managing Director at Golden Gate Capital. “Jay and his team have a tremendous track record of building water infrastructure solutions for the oil and gas industry, and with Waterfield Midstream as Stonehill’s flagship investment, we look forward to helping develop this environmentally-minded platform to meet E&P companies’ evolving needs.”
Mr. Parkinson and Golden Gate Capital have a strong history of success with a prior venture, Hillstone Environmental Partners. Established in 2015, Hillstone designed, built, owned and operated an interconnected water gathering, recycling and disposal system in the heart of the Permian Delaware Basin in Loving and Lea counties with total pipeline capacity of 680,000 bpd and permitted capacity of 1,265,000 bpd. In just four years, Hillstone established itself as an industry-leading provider of comprehensive water infrastructure solutions, with impressive organic growth and a high-quality asset base that included long-term contracts with investment-grade E&P companies. Hillstone was sold to NGL Energy Partners LP (NYSE: NGL) for $600 million in October 2019.
Tudor, Pickering, Holt & Co. acted as financial advisor to Golden Gate Capital and Stonehill and Weil, Gotshal & Manges LLP served as legal counsel.
About Golden Gate Capital
Golden Gate Capital is a San Francisco-based private equity investment firm with over $19 billion in cumulative committed capital. The principals of Golden Gate Capital have a long and successful history of investing across a wide range of industries and transaction types, including going-privates, corporate divestitures, and recapitalizations, as well as debt and public equity investments. Notable investments sponsored by Golden Gate Capital include Hillstone Environmental Partners, U.S. Silica, EP Minerals, Cole-Parmer and Vantage Elevator Solutions. For more information, visit www.goldengatecap.com.
About Stonehill Environmental Partners
Stonehill Environmental Partners is an energy infrastructure company focused on designing, building, owning and operating fixed water pipeline, recycling and disposal assets. Stonehill also focuses on monetizing existing E&P owned water infrastructure assets so E&P companies can re-deploy capital to core drilling and completion activities. Stonehill is backed by Golden Gate Capital, a leading private equity investment firm with over $19 billion in cumulative committed capital. For more information, visit www.sh-ep.eco.