“The acquisition of Sabalo’s water infrastructure is an important step in realizing our vision of being the premier integrated water midstream provider in the Permian Basin,” said Jim Summers, Chief Executive Officer of H₂O Midstream. “The scale of our produced water 'supersystem' in the Midland Basin, coupled with our University Lands partnership in the Delaware Basin, allows us to provide our customers with an unmatched level of service, flexibility, and reliability as they have put their trust in our hands. We are excited to partner with Sabalo in meeting their produced water disposal and recycling needs for years to come.”

Barry Clark, the Chief Executive Officer of Sabalo, stated, “Due to the strong working relationship, location of complementary gathering infrastructure, and proven reliability demonstrated by H₂O Midstream, we determined they were the best team to purchase, operate, and continue the buildout of our integrated water gathering and recycling infrastructure. As a result of this transaction, Sabalo has secured a long-term partnership to gather all of its produced water via pipe and the optionality to scale up produced water recycling operations to meet the needs of an aggressive completion schedule in the future.”

Concurrent with the Sabalo acquisition, EIV Capital and multiple co-investors substantially increased their equity commitment for H₂O Midstream to pursue additional growth opportunities throughout the Permian Basin.

About H₂O Midstream

H₂O Midstream was founded on the vision that water should be treated as a commodity, not a waste, and partners with producers, landowners, and other stakeholders to improve the efficiency, reliability and safety of water operations while lowering costs across the entire value chain. Based in Houston, Texas, with offices in Big Spring and Austin, H₂O Midstream is committed to providing best in class water midstream services to its customers through the use of permanent infrastructure and interconnected gathering, disposal, storage and re-use facilities. Led by an executive team with over 200 years of collective oil and gas upstream and midstream experience, H₂O Midstream owns and operates the Permian’s only truck-free, third-party produced water hub and pipeline network consisting of 1,000,000 barrels of storage and 435,000 barrels per day of permitted disposal capacity from 16 owned and six third-party SWDs, all interconnected via 190 miles of pipeline.

H₂O Midstream is funded via a private equity commitment from EIV Capital and co-investments from several of EIV’s institutional partners collectively representing more than $70 billion in assets under management. For more information, visit www.h2omidstream.com.

Cadence Bank N.A. acted as lead arranger and administrative agent to expand H₂O Midstream’s revolving credit facility and Jackson Walker LLP served as legal counsel to H₂O Midstream.

About Sabalo

Sabalo is a premier private oil and gas company with assets in the core of the northern Midland Basin in Howard County, Texas. Headquartered in Corpus Christi, Sabalo’s core mission is to deliver superior returns to its shareholders and partners through the efficient and responsible development of its unconventional asset base. Sabalo has a successful track record of building strong relationships with its royalty owners and landowners, which remain a key focus in Sabalo’s go-forward development plans. As a part of this, safety and environmentally responsible operations are Sabalo’s number one priority in achieving success.

Sabalo is funded via a private equity commitment from EnCap Investments L.P., a leading provider of growth capital to the independent sector of the US oil and gas industry. For more information, visit www.sabaloenergy.com.

Simmons Energy | A Division of Piper Jaffray^℠ served as exclusive financial advisor to Sabalo in this transaction, and Bracewell LLP served as legal counsel to Sabalo.

Contact:

H₂O Midstream
Darrell Bull, Chief Commercial Officer, (918) 688-8892
Frank Olmsted, Chief Financial Officer, (713) 501-8412

Sabalo Energy
Mike Dignam, VP Finance & Business Development, (361) 888-7708
Philip Bell, VP Land, (361) 888-7708

In January 2019, ULWM signed a long-term contract with University Lands to serve as the exclusive preferred water services provider on 167,000 acres located in Ward, Winkler and Loving counties in the Delaware Basin to develop and operate water infrastructure on the University Lands acreage. University Lands manages the surface and mineral interests of 2.1 million acres of land across nineteen counties in West Texas for the benefit of the Permanent University Fund.

Stephen McNair and Byron Bevers, the President and Vice President, respectively, of UL Water Midstream, stated, “This new strategic investment facilitates ULWM growth organically and through acquisitions. The support of all of our investors demonstrates the importance of the development of water infrastructure across the Delaware Basin.”

About UL Water Midstream

UL Water Midstream was formed to provide full-cycle water midstream services to oil and gas producers across University Lands acreage in the Delaware Basin. ULWM is a partnership of H₂O Midstream, Layne Water Midstream and the new Strategic Partner. As the preferred water service provider for University Lands on it 167,000 acres in Ward, Winkler and Loving counties, ULWM is uniquely positioned to provide efficient and creative solutions to the water needs and demands of producers on that acreage. ULWM is led by President Stephen McNair, an industry veteran who headed the development of Pioneer Natural Resources’ water business before joining H₂O Midstream as EVP and Chief Development Officer. For more information, visit www.ULwatermidstream.com.

Contact:

Stephen McNair
UL Water Midstream President, H₂O Midstream EVP & Chief Development Officer
(214) 263-3780

Darrell Bull
H₂O Midstream EVP & Chief Commercial Officer
(918) 688-8892