This study investigated value-creation levers for midstream asset optimization in U.S. shale basins. ADI modeled the transition from keep-whole to fee-based contracts, their relative share, and analyzed how these structures shift operator focus toward operational efficiency and opex optimization. The research emphasized the risk of contract cliffs and the role of asset optimization software in maintaining competitiveness against PE-backed projects.
The client
Process technology and software developer
The situation
The client required an assessment of midstream commercial transactions to define a value proposition for its “Connected Plant” optimization software.
ADI’s contributions
Commercial risk modeling
Leveraged SEC filings from major operators to map the evolution of midstream risk over a five-year period, highlighting the increasing dominance of volume-driven revenue.
Infrastructure constraint forecasting
Identified basin-level bottlenecks in the Permian and forecasted the migration of constraints to the Bakken and Marcellus to pinpoint high-need optimization sites.
Regulatory impact analysis
Evaluated how federal tax cuts and FERC rate freezing would drive midstream management away from capital projects toward maximizing existing plant returns.
M&A target identification
Defined criteria for acquiring specialty EPCs and asset optimization software providers to build a full-scale consultative service for midstream operational excellence.
Key outcomes
- Identified a growth market among small-to-medium midstream operators who lack internal bandwidth for custom asset optimization and are facing upcoming contract expirations.
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