CorEnergy finances Black Bison acquisition

Black Bison Water Services has acquired its second salt water disposal property after securing a 10-year, $11.5m mortgage facility from CorEnergy.

Chicago-based Black Bison Water Services, a service provider for the disposal of flowback and produced water generated from oil- and gas-producing wells, has closed its acquisition of Reed Well, a salt water disposal (SWD) property in Wyoming’s Powder River Basin.

The acquisition will be financed with proceeds from a mortgage facility provided by Kansas-based CorEnergy Infrastructure Trust, Black Bison said in a statement. The loan will be secured by Black Bison’s SWD properties in Powder River Basin and Green River Basin in Wyoming.

The 10-year secured financing provides Black Bison with borrowing capacity of $11.5 million and the ability to expand its portfolio to four SWD wells, according to Justin Haigler, partner and president of the water disposal services provider.

CorEnergy will purchase a 15 percent equity option in Black Bison, which, with its entry in water disposal services, “satisfies strategic objectives” for the Kansas firm, according to its chief executive David Schulte.

CorEnergy’s history dates to February 2007 when it launched an initial public offering under the name Tortoise Capital Resources (TTO), a closed-end management investment company regulated as a business development company. With most of its securities in energy-related companies and due to its close ties to the energy sector, TTO began to see vast opportunity in direct ownership of infrastructure.

In December 2012, Tortoise Capital Resources changed its name to CorEnergy Infrastructure Trust. The name change was part of the company's transition from a business development company managed by Tortoise Capital Advisors to a real estate investment trust managed by Corridor InfraTrust Management, a real property asset manager focusing on US energy infrastructure.

Corridor is an affiliate of Tortoise Capital Advisors, an investment manager specialising in listed energy investments, which was co-founded by Schulte. As of December 31, 2013 Tortoise Capital had approximately $14.2 billion in assets under management.