Producers Midstream Company Profile

Background

Overview

Producers Midstream II, LLC, commonly known as Producers Midstream, is a Dallas-based midstream company established in 2016. The company specializes in providing comprehensive midstream infrastructure solutions to upstream energy operators across the United States. Its services encompass natural gas gathering, processing, and transportation, as well as natural gas liquids (NGL) transportation and storage. Producers Midstream is committed to enhancing the value of its clients' operations by developing tailored systems that offer increased reliability and predictability. This commitment is supported by a culture of service, ingenuity, and responsiveness.

Mission and Vision

Producers Midstream's mission is to maximize the value of its clients' operations by creating bespoke midstream systems that ensure reliability and predictability. The company's vision is to be the preferred midstream partner for upstream operators, delivering innovative and efficient infrastructure solutions that support the evolving needs of the energy industry.

Industry Significance

Operating within the midstream sector of the oil and gas industry, Producers Midstream plays a crucial role in facilitating the transportation, processing, and storage of energy products. The company's services are vital for upstream operators, as they ensure the efficient and safe movement of resources from production sites to downstream markets. By providing customized infrastructure solutions, Producers Midstream contributes to the overall efficiency and profitability of its clients' operations.

Key Strategic Focus

Core Objectives

Producers Midstream aims to deliver reliable and efficient midstream infrastructure solutions that are tailored to the specific needs of its clients. The company focuses on building scalable systems that can adapt to the dynamic demands of the energy sector.

Areas of Specialization

The company's primary areas of specialization include:

Natural Gas Gathering and Processing: Designing and operating systems that collect and process natural gas from production sites.

Natural Gas Liquids (NGL) Transportation and Storage: Providing infrastructure for the transportation and storage of NGLs, ensuring safe and efficient delivery to market.

Key Technologies Utilized

Producers Midstream employs advanced technologies in its operations, including:

Cryogenic Processing Plants: Utilized for separating natural gas liquids from raw natural gas.

Acid Gas Injection Wells: Employed to safely dispose of acid gases produced during processing.

Compression Equipment: Used to maintain the pressure and flow of natural gas through pipelines.

Primary Markets and Conditions Targeted

The company primarily operates in the following markets:

Delaware Basin: A key area in the Permian Basin, known for its significant oil and gas production.

Mid-Continent and Eastern Permian Basin: Regions with active upstream operations requiring robust midstream infrastructure.

Anadarko Basin: An area with growing energy production, necessitating efficient midstream solutions.

Financials and Funding

Funding History

Producers Midstream has secured substantial funding to support its growth and expansion initiatives. Notable funding events include:

June 2022: The company secured a new syndicated credit facility led by Texas Capital Bancshares, Inc., Bank of Oklahoma, and Cadence Bank, allowing for additional borrowing capacity of up to $200 million.

December 2024: Producers Midstream secured an expanded credit facility of $400 million, led by Texas Capital Bank, Bank of Oklahoma, Cadence Bank, US Bank, and Wells Fargo Bank. This facility is intended to fund development projects across the company's existing asset base and support growth projects in the Delaware Basin.

Notable Investors

Tailwater Capital LLC, an energy and environmental infrastructure private equity firm, is a significant investor in Producers Midstream. Tailwater Capital has a history of working constructively with proven management teams to deliver value-added solutions in the energy sector.

Utilization of Capital

The capital raised through these funding events is allocated towards:

Expansion Projects: Developing new infrastructure in key regions, such as the Delaware Basin.

Operational Enhancements: Upgrading existing facilities to improve efficiency and capacity.

Strategic Growth Initiatives: Pursuing opportunities that align with the company's long-term objectives and market demands.

Pipeline Development

Key Pipeline Candidates

Producers Midstream is involved in the development of several key pipeline projects, including:

Lea County, New Mexico: The company is constructing a new gas gathering, treating, and processing system in this area, utilizing existing assets to expedite deployment.

Stages of Development

The pipeline projects are at various stages:

Phase One: The initial phase in Lea County is expected to be in service by the second quarter of 2025.

Phase Two: An expansion to increase processing capacity by 50% is planned, with full operation expected by the fourth quarter of 2025.

Target Conditions

The pipelines are designed to handle a broad range of gas compositions, including hydrogen sulfide (H₂S), carbon dioxide (CO₂), and nitrogen (N₂), ensuring consistent downstream market delivery.

Anticipated Milestones

Second Quarter 2025: Completion of Phase One in Lea County.

Fourth Quarter 2025: Completion of Phase Two expansion in Lea County.

Technological Platform and Innovation

Proprietary Technologies

Producers Midstream utilizes several proprietary technologies, including:

Cryogenic Processing Plants: For separating natural gas liquids from raw natural gas.

Acid Gas Injection Wells: For safely disposing of acid gases produced during processing.

Compression Equipment: To maintain the pressure and flow of natural gas through pipelines.

Significant Scientific Methods

The company employs advanced engineering and design methodologies to develop efficient and scalable midstream infrastructure. This includes utilizing existing assets to expedite deployment and reduce costs.

Leadership Team

Executive Profiles

Matt Flory: President and Chief Executive Officer. Flory has extensive experience in the midstream sector and has been instrumental in leading Producers Midstream's growth and strategic initiatives.

Hudson White: Chief Financial Officer. White oversees the company's financial operations and has played a key role in securing funding to support expansion projects.

James Hegar: Executive Vice President and Chief Operating Officer. Hegar is responsible for the company's operational strategies and ensuring the efficient delivery of services.

Jim Bryant: Chairman. Bryant founded Producers Midstream and has been a driving force behind its strategic direction and growth.

Clark Hudnall: Senior Vice President, Chief Strategy Officer. Hudnall focuses on the company's strategic initiatives and market expansion efforts.

Will McCraney: Senior Vice President, Chief Commercial Officer. McCraney is responsible for the company's commercial strategies and client relationships.

Leadership Changes

As of the latest available information, there have been no recent significant changes or appointments within the company's leadership.

Competitor Profile

Market Insights and Dynamics

The midstream sector is characterized by a competitive landscape with numerous players offering similar services. Key competitors include: