Kodiak Buys 20,000 HP Compression Assets in Permian for $24 Million

Kodiak Gas Services has acquired more than 20,000 horsepower of compression assets in the Permian Basin under a $24 million deal tied to a long-term service agreement.

(P&GJ) — Kodiak Gas Services has acquired more than 20,000 horsepower of compression assets in the Permian Basin for $24 million, expanding its footprint in one of the most active U.S. oil and gas regions.

The assets will support a seven-year contract compression agreement with the seller, expected to generate more than $7 million in annualized revenue. The equipment will be integrated into Kodiak’s existing operations across Texas and New Mexico.

The deal adds to Kodiak’s strategy of growing its compression portfolio through long-term, fee-based contracts tied to active production areas.

“This transaction underscores Kodiak’s strategy of deploying capital into high-quality, long-duration commercial opportunities with premier operators, and further strengthens our leading position in the Permian Basin,” said Mickey McKee, President and CEO of Kodiak Gas Services. “The multiyear contracted cash flows and quality return characteristics are expected to drive incremental value for our shareholders.”

Following the acquisition, Kodiak said it expects 2026 growth capital expenditures to range between $245 million and $275 million, excluding spending tied to its pending Distributed Power Solutions acquisition.

The company also expects to add approximately 170,000 horsepower of compression in 2026, including the newly acquired units.