Centennial Nixes Water Infrastructure Deal

Centennial Nixes Water Infrastructure Deal
The $225 million deal was supposed to close by May 15.

Centennial Resource Development Inc. said its previously announced divestiture by subsidiary Centennial Resource Production LLC to a subsidiary of WaterBridge Resources LLC has been terminated.

Originally announced in late February, WaterBridge was supposed to acquire the Southern Delaware Basin produced water infrastructure of Centennial Resource Production for $225 million. The transaction included saltwater disposal wells and associated produced water infrastructure located primarily in Reeves County, Texas. The companies were then going to enter a 15-year produced water management agreement for Centennial’s operated acreage within an extensive area of mutual interest.

Centennial provided written notice of termination after WaterBridge failed to close the transaction on or before the end of business on May 15. According to the deal’s terms, Centennial believes it has a right to receive the $10 million purchase price deposit, which is currently held in escrow.

Denver-based Centennial is an independent oil and gas company focused on unconventional oil and gas reserves in the Permian Basin. The company’s assets and operations are concentrated in the Delaware Basin, a sub-basin of the Permian. Centennial was formed in 2016 through the business combination of Centennial Resource Production and Silver Run Acquisition Corp., a special purpose acquisition company formed by Mark G. Papa, its Chairman and CEO, and Riverstone Holdings, an energy private equity fund.

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