San Mateo Midstream Finalizes $752 Million Acquisition of Cardinal Midstream Assets
The acquisition increases San Mateo's natural gas processing capacity to over one billion cubic feet per day and expands its pipeline system to more than 800 miles within the prolific energy region.
San Mateo Midstream announced Monday the completion of its acquisition of Cardinal Midstream Partners' operating subsidiaries for $752 million in cash. [2, 4, 5] The deal significantly expands San Mateo's natural gas gathering and processing infrastructure in the Delaware Basin of West Texas and New Mexico. [3, 5]
San Mateo is a joint venture between Matador Resources Company, which holds a 51% stake, and Five Point Infrastructure, which owns the remaining 49%. [2, 3] The seller, Cardinal Midstream, was a portfolio company of the private equity firm EnCap Flatrock Midstream. [2, 6]
Expanded Delaware Basin Footprint
The acquired assets include a cryogenic natural gas processing plant in Loving County, Texas, with a capacity of approximately 320 million cubic feet per day (MMcf/d), along with about 145 miles of pipelines. [3, 5] This transaction increases San Mateo's total processing capacity to more than one billion cubic feet per day and expands its gathering network to over 800 miles of pipeline. [3, 5]
The integration of the two systems is expected to create a more comprehensive network across the northern Delaware Basin, enhancing operational flexibility and efficiency. [1, 3] The deal also diversifies San Mateo's client portfolio by adding nine new third-party customers. [2, 5] As part of the agreement, all 26 of Cardinal's field employees were offered and accepted positions with San Mateo. [2]
Deal Financing and Outlook
The acquisition, first announced in late June 2026, was financed through a combination of a new $650 million term loan, cash on hand, and capital contributions from its partners. [2, 4, 10] Matador Resources contributed $51 million toward the purchase. [2]
Company officials project that the newly acquired assets could generate up to $110 million in annualized adjusted EBITDA by 2028, contingent on the processing plant reaching full utilization. [2, 4]
Sources
- All News — San Mateo completes $752 million Cardinal Midstream acquisition
- San Mateo completes $752 million Cardinal Midstream acquisition
- San Mateo completes $752 million Cardinal Midstream acquisition
- San Mateo Midstream Acquires Cardinal Midstream
- San Mateo Midstream expands Delaware basin footprint with $752-million acquisition
- Matador's San Mateo Midstream to Acquire Cardinal Midstream for $752M
- San Mateo to Acquire Cardinal Midstream in $752M Deal
- Cardinal Midstream Partners and EnCap Flatrock Announce Sale of Delaware Basin Assets to San Mateo Midstream for $752 Million
- Willkie Advises Cardinal Midstream Partners in $752 Million Sale of Delaware Basin Assets to San Mateo Midstream
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