The agreement would transfer Five Point Infrastructure’s 70% ownership in Deep Blue Midland Basin to Diamondback Energy and KKR, giving them joint ownership of the West Texas water operator if the deal closes.
Five Point says it will receive cash, but neither its announcement nor Diamondback’s disclosed a purchase price. Diamondback held the remaining 30% as of Sept. 30, 2026, according to its Nov. 4 Form 10-Q. The companies say they would own all of Deep Blue together after closing; they have not disclosed how they would divide the acquired stake.
Diamondback’s announcement describes Deep Blue as providing water sourcing, transportation, storage, recycling and disposal. The company says its core operations depend on the dependable movement of nearly 2 million barrels of water a day.
Five Point reported that Deep Blue’s daily managed volume exceeds 2.2 million barrels when recycling is included, while deliveries top 800,000 barrels per day. It also cited a pipeline network stretching more than 2,000 miles, permitted produced-water capacity nearing 5 million barrels a day and storage capacity totaling 142 million barrels.
The companies said Diamondback and Five Point formed Deep Blue as a joint venture in 2023. Diamondback’s Nov. 4 Form 10-Q describes a 15-year commitment covering its produced and supply water in an area of mutual interest spanning 12 counties within the Midland Basin.
KKR said it expects to fund most of its investment through KKR Global Infrastructure Investors V. Five Point described the sale as part of its investment and monetization activity. The parties target a Q4 2026 close, subject to regulatory approvals and other customary conditions.
