Tidewater Midstream and Infrastructure Ltd. has announced the closing of the sale of its Sylvan Lake gas processing facility and associated gas gathering infrastructure to Parallax Energy Operating Inc. for total cash proceeds of $5.5mn, subject to customary adjustments. The transaction involves an asset deemed non-core to Tidewater’s portfolio and is expected to have a minimal impact on the company’s financial results for 2025.
A secondary asset in Tidewater’s portfolio
The Sylvan Lake facility, located in Alberta, processed natural gas on behalf of third parties. Tidewater classified this infrastructure as non-essential to its current strategy, which focuses on vertical integration and optimisation of its core assets. Proceeds from the sale will be used to repay amounts outstanding on the company’s senior credit facility, without affecting other ongoing operations or investments.
This move is part of a broader effort by Tidewater to streamline its asset base, as the company seeks to strengthen its financial structure. Divesting peripheral assets enables capital to be reallocated toward segments with higher profitability or strategic value, particularly in refining and storage infrastructure.
Debt reduction as a priority
The company stated that the funds received will be used exclusively to reduce debt on its bank credit line, signalling a clear commitment to deleveraging. This financial strategy comes amid increased margin pressures across the North American midstream sector, especially for multi-energy operators like Tidewater.
Parallax Energy Operating Inc., the buyer of the facility, has not disclosed its intentions regarding future operations at the site. However, acquiring an operational gas processing site could enhance its regional footprint in Alberta and meet consistent local demand for processing capacity.
