(Source: PrimeNewswire)
OKLAHOMA CITY, Nov. 2, 2009 (GLOBE NEWSWIRE) -- GMX Resources Inc. (Nasdaq:GMXR) (please visit www.gmxresources.com to view the latest corporate presentation) and Kinder Morgan Energy Partners, L.P. (NYSE:KMP) today announced that the two companies have closed their previously announced transaction in which GMXR and its wholly owned subsidiary, Endeavor Pipeline Inc., have transferred mid-stream gas gathering, compression, and related equipment to a newly formed Endeavor Gathering LLC, and an affiliate of Kinder Morgan has purchased a 40% membership interest in Endeavor Gathering LLC from GMXR for $36 million.
Endeavor Gathering LLC owns the mid-stream gas gathering, compression, and related equipment previously held by Endeavor Pipeline Inc. It has agreed to provide firm capacity gathering services to GMXR in its Cotton Valley Sands and Haynesville/Bossier Shale horizontal developments in East Texas, and it is also expected to provide funding of future gathering infrastructure needs to support GMXR's production growth. Endeavor Pipeline Inc. will continue to operate the gas gathering system on a day-to-day basis. The salt water disposal assets and other poly pipelines of Endeavor Pipeline Inc. were not transferred to Endeavor Gathering LLC and will continue to be separately owned and operated by Endeavor Pipeline Inc.
The GMXR team leading Endeavor Gathering will be Keith Leffel (President of Endeavor Pipeline Inc.) and Harry Stahel (Vice President of Finance of GMXR).
Endeavor Gathering gathers gas from approximately 130 wells via its 100 miles of steel pipelines and 25,000 horsepower of owned compression.
"The Kinder Morgan transaction provides liquidity for GMXR to bring an additional rig into the Haynesville/Bossier horizontal drilling program and allows GMXR to increase production, proved developed reserves, cash flow and EBITDA. Additionally, by having Kinder Morgan as our partner in our mid-stream business we have a partner with mid-stream growth expertise and access to additional capital to support future infrastructure build-out. Kinder Morgan is a highly regarded leader in its sector; its interest in our midstream assets speaks volumes about the quality and growth prospects of our Haynesville/Bossier assets and our operational excellence in the E&P sector," GMXR Chief Executive Officer Ken Kenworthy, Jr. said in a statement.
"We are delighted to close this transaction and partner with GMXR in its expansion within the prolific Haynesville/Bossier Shale play," said Tom Martin, president of Kinder Morgan's Texas Intrastate Group.
