Oasis Petroleum Inc. (NYSE:OAS) has filed for the Initial Public Offering (IPO) for its unit Oasis Midstream Partners LP. The IPO of about 7,500,000 common units was launched with an estimated price range of $19-21 each unit. The company plans to raise approximately $150 million at $20.
Morgan Stanley, Wells Fargo Securities, and Citigroup are the key underwriters of the IPO. The agreement between the two firms is expected to allow the grant underwriters a one-month option to procure up to an addition of 1,125,000 common units. The partnership would trade under NYSE with HESM ticker.
After the IPO, the Oasis Petroleum and its associates would possess about 72.7% limited partnership in Oasis Midstream or less if the specified underwriters opt to fully purchase the additional units. Also, the ownership stake expected to be sold in the IPO may rise from 27.3% to 31.4% if the underwriters decide to purchase the additional common units.
Oasis Midstream reported slightly positive revenues of about $140 million for the trailing year ending June 30, 2017. The partnership assets located in the Williston Basin of North Dakota and Montana include the diversified portfolio owned by Midstream. The assets are strategically positioned to increase sales volumes from the potential manufacturers. The assets include the crude oil or natural gas, transport, and water-handling systems.
Oasis Petroleum has continuously acquired assets in the Williston Basin area to boost its acreage and midstream facilities. For instance, the company obtained assets from SM Energy Company SM based in Denver for about $785 million. Also, Oasis Petroleum further added its natural gas processing plant and other assets into the business enterprise.
The financial report for the second quarter of the year reveals that Oasis Petroleum is well positioned to enhance its operations including the Wild Basin, Alger, and Indian Hills. The company is determined to deliver advanced uplifts in production, and maintain an economic balance in the constantly changing business environment. Partnering with Oasis Midstream would help strengthen the company’s asset portfolio.
