Infrastructure: Energy Transfer agreed to acquire Vaquero Midstream for $2.625B, a price that implies fees above any Delaware Basin G&P peer. The deal only works if ET captures the downstream value of Vaquero’s gas and NGLs on its own network – and securing those barrels may be increasingly important as competition for Permian NGL supply intensifies.
New Product: The new NGL Hub Model is now live in Energy Data Studio, adding more granularity across the visuals. Key upgrades include monthly data, new Bakken and Powder River basin corridors, and asset-level fractionator views in Mont Belvieu, providing a more complete view of NGL flows and infrastructure across the Lower 48.
Exports: US NGL exports held flat for the week ending Oct. 2, with a 4.2% increase in LPG exports balanced by a 18.1% decrease in ethane exports.
Infrastructure:
Energy Transfer (ET) agreed to acquire Vaquero Midstream for $2.625B, a price that implies fees above any Delaware Basin G&P peer. The deal only works if ET captures the downstream value of Vaquero’s gas and NGLs on its own assets – and securing those barrels may be increasingly important as competition for Permian NGL supply intensifies.
Vaquero’s Caymus complex in Pecos County, TX processes ~500 MMcf/d against 675 MMcf/d of capacity across three trains. At 7–10x EBITDA, East Daley Analytics estimates the purchase price implies all-in fees of $1.84–2.45/Mcf at current volumes, or $1.47–1.92/Mcf with the plant full (see figure). The richest fee-based Delaware systems East Daley models, ONEOK (OKE) and Western Midstream (WES), earn $1.27–1.34/Mcf. At those fees, the purchase price implies ~11–12x EBITDA for a full plant and ~15–16x on today’s volumes.
ET is also buying meaningful growth optionality. Vaquero owns sufficient acreage to add two processing trains at Caymus, potentially increasing capacity from 675 MMcf/d to ~1.2 Bcf/d. The system is supported by ~100,000 dedicated acres and customer contracts with an average remaining life of approximately 10 years. Even with that upside, the purchase price appears to require meaningful value capture beyond standalone gathering and processing fees.
ET Needs the NGL Barrels
Vaquero may be as important defensively as it is offensively for Energy Transfer’s NGL business.
Competition to control Permian NGL supply is intensifying. In August, Targa Resources (TRGP) signed new 20-year agreements with ExxonMobil (XOM) covering integrated gathering, processing and downstream services across the Permian. The agreements include 20-year NGL transportation and fractionation dedications associated with ExxonMobil acreage across both the Delaware and Midland basins.
ET also faces potential exposure as legacy Kinetik (KNTK) NGL contracts approach expiration. East Daley previously estimated ~75 Mb/d of contracted NGLs could ultimately roll off ET by YE26. That estimate is directional: the exact volume currently delivered under the contracts is unclear, and the expiration date of one of the NGL purchase agreements remains the subject of litigation between Kinetik and ET.
Vaquero provides ET with a meaningful new source of controlled liquids supply against that backdrop. At ~500 MMcf/d of inlet volumes and ~5.3 gal/Mcf of liquids content, Vaquero’s gas contains roughly 63 Mb/d of gross NGL content. At Caymus’ full 675 MMcf/d capacity, that rises to ~85 Mb/d before accounting for recovery rates and ethane rejection.
On a gross liquids-content basis, Vaquero is therefore directionally similar in scale to the potential Kinetik volume exposure. It is not a barrel-for-barrel replacement, but it illustrates why control of Vaquero’s molecules could have value to ET well beyond plant-level G&P margins.
That matters as ET expands its downstream system. In 2Q26, ET completed upgrades adding more than 90 Mb/d of incremental Permian takeaway capacity on Lone Star Express and signed long-term transportation and/or fractionation agreements covering ~300 Mb/d of Y-grade volumes. ET is also expanding Nederland by 240 Mb/d of ethane export capacity and 55 Mb/d of LPG capacity.
The Vaquero premium therefore may reflect more than incremental downstream margin. The acquisition gives ET greater control over Permian barrels that can feed Lone Star, Mont Belvieu fractionation and its growing Gulf Coast export footprint at a time when competitors are securing long-lived supply.
Bottom Line: Vaquero’s G&P fees alone don’t support a $2.625B valuation. ET is paying for control of the molecules and barrels that Vaquero can feed into its broader network.
The acquisition is both offensive and defensive. ET gets incremental gathering and processing EBITDA and meaningful expansion optionality, but the strategic prize is securing Permian gas and NGL volumes that can generate additional transportation, fractionation, terminaling and export revenue across its downstream system. Without sustained drilling and full downstream capture, Vaquero’s standalone fees struggle to carry a $2.625B valuation. With those molecules moving through ET’s entire value chain, the math starts to look different.
New Product:
The new NGL Hub Model is now live in Energy Data Studio, adding more granularity across the underlying data and visuals. Key upgrades include monthly data, new Bakken and Powder River basin corridors, and asset-level fractionator views in Mont Belvieu, providing a more complete view of NGL flows and infrastructure across the Lower 48.
Exports:
US NGL exports held flat for the week ending Oct. 2, with a 4.2% increase in LPG exports balanced by a 18.1% decrease in ethane exports.
LPG exports were supported by stronger volumes at Energy Transfer’s Nederland (+37%) and Phillips 66’s Freeport (+61%) terminals.
On the ethane side, exports from Neches River and Marcus Hook fell to zero. Gains at the remaining terminals offset some of the losses, resulting in a 18% drop in total ethane exports.
