Vivakor, Inc. has executed a non-binding letter of intent to sell the midstream business and transportation assets of its subsidiary, CPE Gathering MidCon, LLC, to Olenox Industries, Inc. for approximately $36 million. The transaction involves Vivakor's Omega pipeline system, an integrated crude oil gathering, transportation, terminaling, and pipeline connection platform serving the Oklahoma STACK play.
The importance of this development lies in its strategic implications for both companies and the broader midstream energy sector. For Vivakor, this divestiture represents a calculated move to streamline operations and focus resources on what the company identifies as its core growth areas. According to the announcement, proceeds from the sale will strengthen Vivakor's balance sheet and allow the company to sharpen its focus on its Permian Basin operations, crude oil supply and trading activities, and remediation processing center businesses.
The deal is structured as a combination of cash, a promissory note, and common and preferred stock based on approximately $4.56 million in annual EBITDA under a take-or-pay guarantee. This structure suggests both parties are seeking to align interests and share in the future performance of the assets. The parties are targeting a definitive agreement and closing on or before March 31, 2026, subject to customary conditions.
For investors and industry observers, this transaction highlights ongoing portfolio optimization within the energy sector, particularly among companies seeking to concentrate on specific geographic or operational strengths. Vivakor's decision to exit the Oklahoma STACK midstream business while maintaining focus on the Permian Basin reflects strategic prioritization in a competitive market. The company's broader mission, as detailed in corporate materials available at https://ibn.fm/VIVK, involves developing, acquiring, accumulating, and operating assets, properties, and technologies in the energy sector.
The potential impact extends beyond the immediate financial transaction. Successful completion of this deal could provide Vivakor with capital to accelerate development of its oilfield waste remediation facilities, which aim to facilitate the recovery, reuse, and disposal of petroleum byproducts and oilfield waste products. This aligns with growing industry and regulatory emphasis on sustainable energy practices and environmental remediation.
As with any letter of intent, the transaction remains subject to negotiation of definitive agreements and satisfaction of closing conditions. However, the announced terms and timeline provide market participants with insight into corporate strategy and asset valuation in the current energy landscape. The full press release detailing this development is available at https://ibn.fm/IxMDe.
