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BUSINESS COMBINATIONS
 12 Months Ended
Dec. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
BUSINESS COMBINATIONS BUSINESS COMBINATIONS
For acquired businesses, we recognize the identifiable assets acquired and the liabilities assumed at their estimated fair values on the date of acquisition with any excess purchase price over the fair value of net assets acquired recorded to goodwill. Determining the fair value of these items requires management’s judgment and the utilization of an independent valuation specialist, if applicable, and involves the use of significant estimates and assumptions.
As of December 31, 2025, our allocations of purchase price for acquisitions made during 2025 and 2024 are detailed below:
Acquisition DateAcquisitionConsideration TransferredCurrent AssetsProperty Plant & EquipmentIntangible AssetsOther Long Term AssetsLiabilitiesContingent Consideration
(In thousands)
(1)Q1 2025Barilla Draw $175,481 $— $164,981 $10,500 $15,652 $15,652 $— 
(2)Q2 2024Durango Permian, LLC$781,167 $61,171 $627,452 $183,000 $3,621 $89,577 $4,500 
Barilla Draw Acquisition
On January 14, 2025, the Company completed the previously announced bolt-on acquisition with Permian Resources Corporation, who directly owns all of the issued and outstanding membership interests of (a) Permian Gathering and (b) Barilla Draw, to acquire all issued and outstanding membership interests of Permian Gathering and Barilla Draw for $175.5 million of cash consideration. Assets acquired consisted of natural gas and crude gathering pipelines and compression of $165.0 million, intangible right-of-way assets of $10.5 million and operating lease right of use assets of $15.7 million. Acquired gathering pipelines and compression were valued based on replacement cost along with economic obsolescence adjustments. These assets are depreciated over an estimated useful life of 20 years. Intangible right-of-way assets were valued based on the across the fence method and are amortized over an estimated useful life of seven years. Acquired net assets from this business combination were included in the Midstream Logistics segment. This transaction was accounted for as a business combination in accordance with ASC 805 Business Combination (“ASC 805”). The Barilla Draw Acquisition provides a multi-stream opportunity for natural gas gathering, compression and processing, as well as crude gathering services for the Company.
For the year ended December 31, 2025, the Company recorded measurement period adjustment totaling $2.9 million related to working capital settlement for the effective period. Acquisition-related costs were immaterial for this transaction. For the year ended December 31, 2025, excluding intercompany revenue and cost of sales, Barilla Draw recorded revenues of $24.6 million and net income of $3.5 million.
Supplemental pro forma information is omitted for the Barilla Draw Acquisition as Permian Gathering and Barilla Draw’s historical financial records are unavailable and cannot be reconstructed without undue cost and effort.
Durango Acquisition
On June 24, 2024, the Company consummated the transaction contemplated by the Durango MIPA, dated May 9, 2024, by and between the Company, the Partnership, and the Durango Seller, pursuant to which the Partnership purchased all of the membership interests of Durango from the Durango Seller for an adjusted purchase price of approximately $785.7 million. Durango Seller is entitled to an earnout of up to $75.0 million in cash (the “Kings Landing Earnout”), contingent upon the completion of the Kings Landing gas processing complex in Eddy County, New Mexico (the “Kings Landing Project”), which was placed into service in September 2025. The Kings Landing Earnout is subject to reductions based on actual capital costs associated with the Kings Landing Project. The Company recorded a contingent liability related to the Kings Landing Earnout based on project completion probability. See additional information in Note 17—Commitments and Contingencies in the Notes to our Consolidated Financial Statements set forth in this Form 10-K. The Durango Acquisition allows the Company to further expand its footprint into New Mexico and across the Northern Delaware Basin. The Durango Acquisition was accounted for as a business combination in accordance with ASC 805 and acquired net assets were included in the Midstream Logistics segment.