Strategic Acquisition Expands Deep Blue's Footprint in the Midland Basin

MIDLAND, Texas, June 3, 2024 /PRNewswire/ -- Deep Blue Midland Basin LLC ("Deep Blue" or the "Company"), a joint venture between Diamondback Energy (NASDAQ:FANG) and Five Point Energy LLC ("Five Point"), announced today it has acquired Lagoon Operating – Midland, LLC ("Lagoon"). This strategic acquisition further solidifies Deep Blue's position as a key player in sustainable water management in the core of the Midland Basin.

The Lagoon assets are located primarily in Martin County and include approximately 105 miles of large diameter pipeline, 240,000 bpd of disposal capacity and 544,000 bpd of additional permitted disposal capacity. Lagoon's assets significantly expand Deep Blue's existing recycling capabilities and are underpinned by a strong portfolio of acreage dedications and MVCs from leading producers in the Midland Basin.

"The acquisition of Lagoon brings together complementary water systems that expand our footprint and unlock synergies across the broader business that will enhance efficiency, reliability and growth opportunities," said Scott Mitchell, CEO of Deep Blue. "The combined business reinforces Deep Blue's position as a leading sustainable water solutions provider, capable of navigating the changing needs of our customers in the Midland Basin."

Since the formation of the joint venture in September 2023, Deep Blue has added multiple third-party commercial contracts and continues to expand the Company's asset footprint. These commercial agreements represent approximately 60,000 dedicated acres with seven new counterparties. With the closing of the Lagoon transaction, the Company has approximately 2.5 million bpd of permitted produced water disposal capacity and over 1,000 miles of large-diameter pipeline with redelivery capacity of over 600,000 bpd.

David Capobianco, CEO of Five Point and Chairman of Deep Blue, said, "We are proud to have built the premier sustainable water management platform in the Midland Basin, and to count among our partners many of the Permian Basin's most respected producers. Deep Blue will continue to expand its customer base, bringing next generation water management solutions, including recycling, enhanced evaporation and desalination technologies to our partners."

Jackson Walker LLP and Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to Deep Blue.

About Deep Blue

Deep Blue is headquartered in The Woodlands and Midland, Texas and develops, owns, and operates integrated midstream water infrastructure networks to manage water for exploration and production companies throughout the Midland Basin. The Company's mission is to create value for its customers and stakeholders by addressing their long-term water management requirements through integrated pipeline systems and sustainable water management practices. Deep Blue's goal is to minimize disposal through water recycling and advanced technologies such as desalination and enhanced evaporation. For more information about Deep Blue, please visit: www.deepbluewater.com.

About Diamondback Energy

Diamondback is an independent oil and natural gas company headquartered in Midland, Texas focused on the acquisition, development, exploration and exploitation of unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas. For more information about Diamondback please visit: www.diamondbackenergy.com.

About Five Point Energy

Five Point Energy is a private equity firm focused on building businesses within the environmental water management and sustainable infrastructure sectors. The firm was founded by industry veterans who have had successful careers investing in, building, and running midstream infrastructure companies. Five Point's strategy is to buy and build assets, create companies, and grow them into sustainable enterprises with premier management teams and industry-leading E&P partners. Based in Houston, Five Point targets equity investments up to $1 billion and has approximately $5 billion of assets under management across multiple investment funds. For more information about Five Point Energy, please visit: www.fivepointenergy.com.

Deep Blue Media Contact

Robert Norton

+1 (303) 775-3562

robert@deepbluewater.com

Diamondback Investor Contact

Adam Lawlis

+1 (432) 221-7467

alawlis@diamondbackenergy.com

Five Point Media Contact

Daniel Yunger

+1 (917) 574-8582

daniel.yunger@kekstcnc.com

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SOURCE Deep Blue Midland Basin LLC

DEEP BLUE MIDLAND BASIN LLC ACQUIRES LAGOON OPERATING - MIDLAND, LLC