The pipeline industry has entered another period of consolidation, and Kelcy Warren’s Energy Transfer is at the center of it. Over the past two years, the company has acquired Enable Midstream, Lotus Midstream and, most recently, Crestwood Equity Partners in a deal valued at $7.1 billion, continuing a run of dealmaking that has defined Kelcy Warren’s tenure as executive chairman.
The Crestwood purchase stands out for how well it fits Energy Transfer’s existing footprint. The acquisition strengthens the company’s position in the Permian Basin and Bakken Shale while opening the door to the Powder River Basin, a region where Energy Transfer previously had little presence. “They are very compatible,” Warren said of Crestwood’s connectivity to Energy Transfer, noting that some capital construction is still needed to fully link the systems.
Demand Drives the Timing
Rising crude oil and LNG exports have pushed pipeline capacity demand higher across the country, giving Energy Transfer’s recent acquisitions added urgency. Kelcy Warren has framed the current run of deals as a response to that demand rather than a plan set years in advance.
“I’d like to tell you that we saw everything in advance and we’re smarter than everybody else, but that’s just not true,” Warren said. “We’ve been very reactive here, but I think our reactions have been pretty good.”
Fewer Targets Remain
Warren has acknowledged that the list of attractive acquisition targets keeps shrinking. “There’s fewer and fewer, one by one we’re checking ’em off,” he said. “But there’s still some really good assets out there that we’ve got our eyes on that we think fit us really, really well.”
Even with the pool of candidates narrowing, Warren continues to describe Energy Transfer’s growth as unfinished business. “We always try to make our machine more efficient,” he added. “If you’re a good pipeliner, you’ll never have the perfect system.” Refer to this article to learn more.
Find more information about Warren on https://www.bloomberg.com/billionaires/profiles/kelcy-l-warren/