Energy Transfer to Buy Vaquero Midstream for $2.63 Billion in Cash and Stock, Expanding Delaware Basin Network

Energy Transfer said Tuesday it has agreed to acquire Vaquero Midstream in a deal valued at about $2.63 billion in cash and stock, according to Reuters.

The transaction includes $1.95 billion in cash and about 33.3 million newly issued Energy Transfer common units, the companies said in an announcement carried by Business Wire. The deal is expected to close in the fourth quarter of 2026, subject to regulatory approval and customary closing conditions.

Delaware Basin assets join a larger network

Vaquero operates about 300 miles of wellhead gathering and intrabasin transportation pipelines in the Delaware Basin, including in Loving, Reeves, Ward and Winkler counties in Texas, according to the announcement. Its Caymus Processing Complex has three processing trains with total capacity of about 675 million cubic feet per day, with room for two additional trains that could raise capacity to about 1.2 billion cubic feet per day, according to the announcement.

The assets are already connected to Energy Transfer’s existing natural gas and natural gas liquids infrastructure and would provide additional volumes for its transportation, fractionation, terminalling and export businesses, according to Reuters and the announcement. Energy Transfer said Vaquero’s system is backed by long-term, fee-based contracts across about 100,000 dedicated acres, with an average remaining contract life of about 10 years, and that the deal should be immediately accretive to distributable cash flow per common unit, according to the announcement.

J.P. Morgan Securities advised Energy Transfer on the deal, while Houlihan Lokey advised Vaquero, according to the announcement.

Reporting based on coverage by Reuters and Business Wire.