There’s nothing like an industry mega-deal to energize us oil and gas folks and Sunday’s announcement from Tulsa-based ONEOK is no exception. It’s also one of the more interesting acquisitions to come along in a while.

Reese Energy Consulting today is following the surprise news from ONEOK, which will acquire Tulsa-based Magellan for $18.8 billion. The “surprise” element (at least for us) isn’t necessarily the number of zeros behind the 18.8 as it is ONEOK’s huge leap as a natural gas and NGLs midstream operator founded in 1906, into crude oil and refined products.

Diversifying on a scale this large hasn’t followed the M&A trend we’ve seen lately. Here’s a brief recap: On the midstream side in 2022, we saw operators snap up predominantly natural gas infrastructure that expanded their existing footprint and services. The largest of these deals were Targa’s $3.6 purchase of Lucid, Enterprise’s $3.25 billion acquisition of Navitas, and three acquisitions by Williams for $2.8 billion. Everyone stayed in their own lane, so to speak, where natural gas and NGLs were the product platforms.

The ONEOK deal is a significant departure but one that will make ONEOK an energy infrastructure giant. Among the acquired assets are the nation’s longest petroleum products pipeline systems at 9,800 miles with access to half of the country’s refining capacity.