Noble Midstream Announces Simplification and Acquisition of Midstream Interests from Noble Energy

Noble Midstream Partners LP (NYSE: NBLX) ("Noble Midstreama?? or the "Partnershipa??) today announced it has entered into a definitive agreement (the "Contribution and Simplification Agreementa?? or "the Transactionsa??) to acquire the Partnershipa??s incentive distribution rights (IDRs) and substantially all of Noble Energya??s (NYSE: NBL) ("Noble Energya??) remaining midstream interests for $1.6 billion. The total consideration will consist of both cash and common units of limited partner interests in the Partnership ("common unitsa??).

Highlights Include:

The Transactions are expected to be approximately 5% accretive to Noble Midstreama??s estimated distributable cash flow1 per unit in 2020.

The acquired interests include $160 million in anticipated 2020 Adjusted EBITDA1 and $40 million in IDR distributions, implying an aggregate 8x 2020 transaction multiple.

Concurrent with the transaction, NBLX has reset the long-term distribution growth rate target to 10 percent annually, resulting in an estimated distribution coverage ratio1 of 1.3x in 2020.

The Transactions reduce pro-forma 2019 Last Quarter Annualized (LQA) EBITDA1 leverage to ~3.8x and 2020 LQA EBITDA leverage to 3.1x.

The Transactions fully align Noble Midstream with Noble Energy through the Partnershipa??s now 100% ownership in Noble Energya??s current U.S. onshore focus areas.

Acquired assets include NBLXa??s first gas processing complex in the DJ Basin and incremental 3-stream gathering in the southern Delaware Basin.

Private unit offering of $250 million increases common unit float by ~55%, which is expected to enhance trading liquidity.

Commenting on the acquisition, Brent J. Smolik, Chief Executive Officer of Noble Midstream, said "Noble Energy has completed its midstream strategic review. We are excited to announce the resulting simplification and drop transaction. This financially-attractive acquisition of essentially all of Noble Energya??s remaining midstream assets will enhance operational synergies and increase economic alignment in Noblea??s growth basins. The acquisition is expected to be accretive to distributable cash flow per unit.

With a significant amount of the backbone infrastructure complete and Noble Energya??s deep drilling inventory in both the DJ and Delaware basins, these assets are expected to further drive our capital efficiency beyond our successful 2019 levels. The long-term strategic alignment with Noble Energy will enhance the growth in Noble Midstream LP unit distributions to NBLa??s ownership interest.a??

Tom Christensen, Chief Financial Officer added, "The elimination of the IDRs and the acquisition simplifies our structure and enhances alignment with the sponsor, immediately lowering our cost of capital and supporting strategic long-term growth and value creation. Pro-forma for the acquisition, NBLX maintains peer-leading leverage, and with the added scale, commands a high return opportunity set to deliver top tier returns to its unitholders. This transaction results in a self-funding midstream entity with increased exposure to two high return onshore basins as well as promising equity barrel value opportunities. By recalibrating our distribution, we retain a leading distribution growth rate relative to peers while better aligning the distribution with midstream investor expectations.a??
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