Kinder Morgan Inc is to enter the Bakken shale with its US $3 billion acquisition of Hiland Partners, a pipeline and logistics company founded by Continental Resources CEO Harold Hamm.
The deal includes acreage in the Bakken’s best producing counties from which Kinder expects substantial oil output.
“The Bakken is the one producing basin in which Kinder Morgan doesn’t have a large presence,” chief executive Rich Kinder told analysts on Wednesday. “We are in the Tier 1 sweet spot of the Bakken. Otherwise we wouldn’t have done the deal.”
The company also announced that Kinder, cofounder of the company, will step down as chief executive in June in a long-expected move. Both announcements came with the company’s release of quarterly results that included net income of $566 million, down from $704 in the same period of 2013. Hiland Partners operates oil pipelines and natural gas processing systems primarily in the Bakken shale in North Dakota and Montana. Customers include Continental and Hess Corp. The deal is slated to close during the first quarter of this year.