Under the Select Water Pilot acquisition agreement, Select Water Solutions (NYSE: WTTR) will pay $600 million in cash and $100 million of Class A stock to expand its produced-water infrastructure in the Delaware Basin.
The agreement also includes as much as $15 million of contingent cash consideration. Select expects the transaction to close in the fourth quarter, subject to regulatory approvals and customary conditions.
Select Water Pilot Acquisition Expands Contracted Volumes
Pilot’s portfolio includes 480,000 barrels a day of minimum-volume commitments and 306,000 dedicated acres under long-term agreements, according to Select’s official transaction announcement. More than 80% of annual revenue is backed by long-term contracts with an average duration above seven years.
The business operates about 2.7 million barrels a day of active permitted disposal capacity, another 900,000 barrels of undeveloped permitted capacity and more than 700 miles of pipelines. Most current volumes are handled in the Delaware Basin across New Mexico and Texas.
A recently signed 175,000-barrel-a-day commitment is expected to lift Pilot’s handled volumes from roughly 850,000 barrels a day in the first half of 2026 to about one million in 2027.
Forecast EBITDA Depends on Volume Growth and Synergies
Select projects Pilot will produce $100 million to $110 million of adjusted EBITDA in 2026 and $120 million to $130 million in 2027. It is targeting an additional $10 million to $15 million of annual cost savings within 12 to 18 months.
Those figures are company forecasts rather than completed results. They depend on contracted volumes beginning as planned, the systems being integrated and operating costs meeting management’s assumptions.
Select expects Water Infrastructure to represent about 70% of pro forma gross profit before depreciation and amortization in 2027. It also forecasts net leverage below two times at closing, though the final ratio will depend on financing, cash generation and transaction adjustments.
Regulatory clearance and the fourth-quarter closing are the next steps. After completion, reported volumes, realized synergies and leverage will show whether the acquisition performs in line with Select’s projections.
