Diamondback, KKR to acquire Five Point’s stake in Deep Blue
Diamondback Energy (FANG) and KKR will jointly acquire Five Point Infrastructure's 70% stake in Deep Blue Midland Basin LLC, a water infrastructure platform. The deal is expected to close in Q4 2026. Diamondback will have full ownership of Deep Blue, which is critical for its operations, requiring nearly 2 million barrels of water per day. KKR will fund the investment through KKR Global Infrastructure Investors V.
How this was made
The 30-second read
Why it matters
The transaction secures essential water transport for Diamondback’s oil and gas operations, while expanding KKR’s infrastructure exposure. Completion is expected in Q4 2026 pending approvals.
Market read
The deal could influence share prices of Diamondback and KKR as investors assess the strategic value of water logistics in the Permian Basin.
What to watch
Regulatory approvals and the capital structure impact of the KKR-funded portion are not detailed.
Background
Diamondback Energy (FANG) and KKR (KKR) are jointly acquiring Five Point Infrastructure’s majority stake in Deep Blue Midland Basin LLC, a water infrastructure JV serving the Permian Basin.
Ticker impact
Diamondback Energy announced a joint acquisition with KKR of Five Point's 70% stake in Deep Blue, completing its ownership of the water infrastructure platform.
potential modest upside as the market prices in secured water supply for core operations
Acquisition removes reliance on external water providers and aligns with Diamondback's Permian focus.
KKR is investing alongside Diamondback to acquire Five Point Infrastructure’s 70% stake in Deep Blue, expanding its infrastructure portfolio.
limited immediate impact; investors may view it as a standard infrastructure deployment
Deal size is undisclosed; effect depends on future cash flows from the water platform.
Market effects
Strengthens the water infrastructure niche within the energy sector, potentially prompting peer interest.
May boost sentiment for Permian Basin operators reliant on water logistics.
Limited to U.S. energy and infrastructure investors.
Counterpoint
The acquisition could strain Diamondback’s balance sheet if financing is costly, outweighing operational benefits.
Key entities
- CompanyDiamondback Energy
US-listed oil and natural gas producer (NASDAQ:FANG).
- CompanyKKR
Global investment firm (NYSE:KKR).
- CompanyFive Point Infrastructure
Private infrastructure investor selling its 70% stake.
