Blackbuck signs sustainability loan



Water and the environment are inextricably linked, and water management companies are increasingly taking advantage of this opportunity.

Water management companies that help oil and gas producers extract and obtain the water they need to operate, and reuse and recycle water derived from raw and natural gas, are embracing the trend towards sustainability-based financing.

Solaris Water Midstream in April became the first energy company to raise $ 400 million through sustainability bonds tied to a percentage of the water produced it recycles.

Blackbuck Resources is now following suit with Riverstone Credit Partners LLC for a fixed-term sustainability loan. The cost of the credit line will be adjusted based on Blackbuck’s commitment to specific sustainability targets. Riverstone’s initial $ 50 million commitment includes a feature that gives Blackbuck additional liquidity to grow.

“We have our own internal goals for recycling and the infrastructure we are implementing,” said Justin Love, CEO and President of Blackbuck.

In a telephone conversation with Reporter-Telegram, he said Riverstone wants to leverage these internal goals to encourage Blackbuck to achieve them. According to him, the achievement of these goals will reduce the cost of the loan, and failure to meet them will increase the cost.

Love mused that the average water flow, which he said has grown into an entirely new sector in just ten years, is attracted to sustainability bonds because it’s a way to get funding as well as protect water resources.

“Many people think oil and gas or pipelines are dirty,” he said. “But we are great environmentalists.”

Blackbuck, which operates in four Permian Basin counties – Culberson, Ector and Martin Counties in Texas and Eddy County in New Mexico – has five salt water treatment plants and 100 miles of formation water collection and distribution lines and a salt mine to remove solids. waste. Love said the company is trying to maximize recycling, noting that recycled water is water that is not pumped into wells for disposal, or fresh water drawn from groundwater.

He added that the company’s pipelines are also removing trucks from the roads, reducing traffic-related emissions. He estimates that the produced water, transported by trucks, averages about 40 miles from the extraction site to the disposal site. With trucks carrying 100 barrels at a time, “that’s billions and billions of barrels of water and a quarter ton of carbon dioxide emissions per load.”

Love hopes that as water companies like Blackbuck grow into full-fledged water recycling companies and reuse increases, work will begin to develop uniform metrics and the sector will begin to standardize processes.


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