Plains Acquires 55% Stake in EPIC Pipeline in $1.6 Billion Crude Oil Deal

Plains Strengthens Crude Infrastructure with EPIC Pipeline Acquisition

Plains All American Pipeline and Plains GP (collectively, Plains) will acquire a 55% non-operated stake in EPIC Crude Holdings for $1.57 billion, including roughly $600 million in debt. The deal boosts Plains’ position in the U.S. midstream sector by deepening its crude oil transport network from the Permian and Eagle Ford basins to the Gulf Coast market in Corpus Christi.

As part of the transaction, Diamondback Energy and Kinetik will each divest their 27.5% equity stakes in EPIC Crude. Both companies will receive around $500 million in upfront cash. Additionally, the agreement includes a $193 million earnout if EPIC expands to 900,000 barrels per day (bpd) of capacity by the end of 2027. This implies a full valuation of $2.85 billion, with $350 million tied to expansion targets.

The EPIC Pipeline system features approximately 1,287 kilometers of long-haul crude infrastructure. It currently supports 600,000 bpd of throughput, seven million barrels of storage, and 200,000 bpd of export capacity. Ares Management retains a 45% stake and continues as the system operator.

EPIC Pipeline Deal Advances Plains’ Permian-to-Gulf Strategy

This acquisition aligns with Plains’ strategic goal to link wellhead to water through an integrated crude delivery system. It enhances upstream connectivity from two major U.S. shale basins while expanding downstream market access in Corpus Christi. Plains highlighted long-term minimum volume commitments from high-quality shippers, which provide revenue stability.

Chairman and CEO Willie Chiang emphasized that the acquisition complements Plains’ existing assets and enhances customer offerings. He noted the expanded system improves reliability, market flexibility, and access to multiple refining and export centers.

The deal is expected to be immediately accretive to Plains’ distributable cash flow. Management projects mid-teens unlevered returns, signaling a strong financial fit. Plains will fund the transaction with a mix of cash and debt, keeping its leverage ratio within target.

The acquisition is set to close by early 2026, pending customary regulatory approvals, including Hart-Scott-Rodino clearance.

SuperMetalPrice Commentary:

Plains’ strategic stake in the EPIC Pipeline signals growing momentum in U.S. crude logistics consolidation. As Permian production remains resilient and Gulf Coast export demand rises, owning critical transport routes like EPIC becomes essential. This deal not only secures physical throughput but also boosts Plains’ long-term competitiveness in midstream infrastructure. The attached earnout further reveals confidence in rising basin volumes and market-linked scalability. In a tightening global energy market, access, integration, and export flexibility are key midstream differentiators—and Plains just strengthened all three.