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Diamondback sells its stake in EPIC Crude for $500 million

Diamondback Energy announced the sale of its 27.5% stake in EPIC Crude Holdings to Plains All American Pipeline for $500 million in cash, with a potential deferred payment of $96 million.

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Diamondback Energy, Inc. has entered into a definitive agreement to sell its 27.5% stake in EPIC Crude Holdings, LP to a subsidiary of Plains All American Pipeline, L.P. and Plains GP Holdings. The deal includes an upfront payment of approximately $500 million in cash, with an additional $96 million contingent payment if an expansion of EPIC Crude’s capacity is approved before the end of 2027.

The transaction values EPIC Crude at $2.85 billion for 100% of the equity, with an additional $350 million linked to the expansion-related consideration. Closing is expected in early 2026, subject to customary regulatory approvals, including clearance under the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976.

A strategy of divesting non-core assets

This divestment is part of Diamondback’s broader strategy to focus on its core assets in the Permian Basin. The company aims to streamline its portfolio by selling non-essential interests while maintaining strong commercial ties with former partners. As part of this, Diamondback will remain a key shipper on the EPIC Crude pipeline.

The sale does not alter existing commercial agreements between Diamondback and EPIC Crude. The company plans to continue shipping crude oil through this strategic network, ensuring continuity of operations in the region.

A strong signal on oil infrastructure valuation

The deal comes at a time when energy infrastructure assets continue to be valued highly despite long-term demand uncertainties. The price paid by Plains reflects the strength of contractual flows tied to the EPIC Crude pipeline, which connects the Permian Basin to the port of Corpus Christi, Texas.

Plains All American Pipeline continues its expansion in crude oil transport infrastructure. This acquisition strengthens its presence in a strategic region for hydrocarbon exports to international markets. No immediate capacity adjustments were announced as part of the deal.

Kaes Van’t Hof, Chief Executive Officer of Diamondback, stated that the deal generated “a meaningful return on invested capital”, while highlighting the company’s intention to maintain close cooperation with EPIC Crude and Plains teams.

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