Key Takeaways
- • KKR and Diamondback Energy have agreed to acquire Five Point Infrastructure's 70% stake in Deep Blue Midland Basin, a Permian Basin water infrastructure business, in a transaction valued at approximately $2.1bn, according to Reuters.
- • Diamondback will increase its existing 30% holding to 50%, while KKR acquires the remaining 50%.
- • Truist Securities estimates Diamondback will contribute about $602m and KKR around $1.51bn; the companies have not disclosed financial terms.
- • Deep Blue supports nearly two million barrels of water per day for Diamondback's operations, providing sourcing, transportation, recycling and disposal services to Midland Basin producers.
- • The transaction is expected to close in the fourth quarter of 2026 and could serve as a platform for further joint infrastructure investment in the Permian Basin.
Summary
KKR and US energy producer Diamondback Energy have agreed to acquire Five Point Infrastructure's 70% stake in Deep Blue Midland Basin, a water infrastructure business operating in Texas's Permian Basin. The transaction is valued at approximately $2.1bn, according to a report by Reuters.
Under the structure, Diamondback, which already owns 30% of Deep Blue, will increase its holding to 50%, and KKR will acquire the remaining 50%. Analysts at Truist Securities estimate Diamondback will contribute approximately $602m, while KKR will invest around $1.51bn. The companies have not disclosed financial terms.
Deep Blue provides water sourcing, transportation, recycling and disposal services to energy producers in the Midland Basin. Its infrastructure currently supports nearly two million barrels of water per day for Diamondback's operations, underscoring the asset's importance to the producer's activity in the region.
The investment could also establish a platform for further joint infrastructure investments as energy production and industrial activity expand across the Permian Basin. The transaction is expected to close in the fourth quarter of 2026.
Under the structure, Diamondback, which already owns 30% of Deep Blue, will increase its holding to 50%, and KKR will acquire the remaining 50%. Analysts at Truist Securities estimate Diamondback will contribute approximately $602m, while KKR will invest around $1.51bn. The companies have not disclosed financial terms.
Deep Blue provides water sourcing, transportation, recycling and disposal services to energy producers in the Midland Basin. Its infrastructure currently supports nearly two million barrels of water per day for Diamondback's operations, underscoring the asset's importance to the producer's activity in the region.
The investment could also establish a platform for further joint infrastructure investments as energy production and industrial activity expand across the Permian Basin. The transaction is expected to close in the fourth quarter of 2026.
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