A Fort Worth pipeline company just sold off its entire natural gas gathering and processing business in the Permian Basin for $4.4 billion, capping a two-step exit that also sent its Delaware Basin pipelines to a rival operator earlier this year. Brazos Midstream's Midland Basin assets are heading to Tulsa-based ONEOK, a deal announced Sunday that ranks among the largest transactions ever involving Permian Basin pipeline infrastructure.
ONEOK said it will pay $4.425 billion in cash for Brazos Midstream's gathering and processing operations, according to the Fort Worth Report. The company is financing the purchase through a $9 billion nonvoting minority equity investment from Apollo Funds, which lets ONEOK put $5 billion toward paying down existing debt and bring its leverage down to 3.25 times debt-to-EBITDA without issuing new common stock, per a filing detailed by ONEOK's investor relations office. Fort Worth Report's Bob Francis, the outlet's business editor, wrote up the deal for the paper's business section.
Brazos Midstream's Midland Basin platform had been backed by private equity firms Old Ironsides Energy and EnCap Flatrock Midstream, which agreed to the sale of the operating company's gathering and processing assets, as noted by PE Hub. The sale follows a related transaction in June, when Western Midstream Partners acquired Brazos Midstream's Delaware Basin pipelines for $1.6 billion, according to Fort Worth Report — a move that let Brazos systematically shed one Permian sub-basin before liquidating the other.
A Rapid Buildout in Glasscock County
The timing is notable: just three weeks before the sale was announced, Brazos Midstream revealed plans to build Cassidy II, a 300 million-cubic-feet-per-day cryogenic gas plant at its Glasscock County complex, per the same account. That expansion is designed to double the facility's processing capacity to 600 million cubic feet per day by summer 2027. Once construction wraps on Cassidy II and other ongoing projects, the acquired assets will roughly double ONEOK's existing natural gas processing capacity in the Midland Basin to about 2.3 billion cubic feet per day, per Oil & Gas Journal. Fort Worth Report separately reported that Brazos Midstream will provide 1.2 billion cubic feet per day of processing capacity once Cassidy II is completed, expected in the third quarter of 2027.
Brazos Midstream's system includes roughly 700 miles of natural gas gathering infrastructure spanning seven core Midland Basin counties, according to Fort Worth Report. The network is anchored by around 600,000 dedicated acres under long-term, fixed-fee contracts averaging more than 12 years remaining, with roughly 4,000 undrilled well locations still ahead, Oil & Gas Journal reported. Founded in 2014, Brazos Midstream's producer base within ONEOK's broader Permian platform includes ExxonMobil, Diamondback Energy, and Fort Worth's own Double Eagle, and the combined operation is supported by 14 active drilling rigs, per Fort Worth Report.
Fort Worth's Stake in the Deal
Rey Treviño, director of operations at Pecos Country Energy, told Fort Worth Report the deal is exciting for both the Permian Basin and Fort Worth, adding that it shows the importance of infrastructure. Natural gas moving through the pipelines is headed to the Gulf Coast, where it feeds a liquefied natural gas export sector that barely existed a decade ago — LNG shipments grew from near zero in 2016 to 569.3 billion cubic feet in December 2025, according to Fort Worth Report.
That growth reflects a broader shift underway across the Permian Basin, where gas has become an increasingly important commodity in its own right rather than a byproduct of oil drilling. Economist Ray Perryman told Fort Worth Report that natural gas has become critical for both exports and domestic use, and that liquefied natural gas exports have become especially important to Europe since the invasion of Ukraine cut off Russian supplies. Perryman also pointed to a newer source of demand: the rapid expansion of energy-intensive AI data centers, which is spurring domestic appetite for natural gas to generate electricity.
Record Production Fuels Consolidation
U.S. natural gas production hit a record high in 2025, averaging 118.5 billion cubic feet per day and rising by 5.3 billion cubic feet per day over the year, per the Fort Worth Report's reporting. The Permian Basin — often described as the fastest-growing natural gas-producing region in the country — accounted for about 23% of that national output. The federal U.S. Energy Information Administration projected in August that marketed natural gas production nationally will average an even higher 122.5 billion cubic feet per day in 2026, driven largely by a 6% output increase in the Permian to 29.2 billion cubic feet per day.
Much of that growth traces back to geology rather than new drilling alone. EIA data reported in July showed Permian natural gas production grew 60% between 2021 and 2025, compared with 39% growth in crude oil, as maturing wells pushed the region's gas-to-oil ratio up 16% to nearly 4,200 cubic feet of gas per barrel of oil, according to OK Energy Today. That dynamic is exactly why processing complexes like the Cassidy II plant are being built out so aggressively — aging oil wells are throwing off more associated gas than the existing infrastructure was built to handle.
Part of a Larger Buying Spree
The Brazos deal is the latest in a string of major acquisitions for ONEOK, which acquired EnLink Midstream in two transactions valued at $7.6 billion that closed in January 2025, per Fort Worth Report. That followed ONEOK's $14.1 billion purchase of Magellan Midstream Partners in 2023 and its $2.6 billion acquisition of Medallion Midstream in 2024, according to BigGo Finance. Once finalized, the Brazos assets will add directly to ONEOK's existing Permian Basin platform, significantly expanding the company's gas infrastructure footprint across West Texas.
The acquisition was unanimously approved by ONEOK's board of directors and is expected to close in the fourth quarter of 2026, subject to customary closing conditions, regulatory clearance, and Hart-Scott-Rodino antitrust review, per BigGo Finance. Barclays is advising ONEOK on the transaction, while Akin Gump Strauss Hauer & Feld is representing Brazos Midstream. How closely federal antitrust regulators scrutinize ONEOK's growing share of Permian gathering and processing capacity, and how quickly the company folds the new pipelines into its Gulf Coast export and natural gas liquids network, remain open questions as the deal moves toward closing.
