What is Sales and Marketing Strategy of Delek Logistics Company?

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How does Delek Logistics reach its customers?

Delek Logistics Partners, LP has evolved into a comprehensive midstream provider, bolstered by strategic acquisitions like H2O Midstream in September 2024 and Gravity Water Midstream in January 2025. These moves have expanded its service offerings across crude oil, natural gas, and water logistics, particularly within the Permian Basin.

The company's market strategy has shifted from primarily supporting its parent company's refining operations to a more diversified, third-party focused approach. By the fourth quarter of 2024, approximately 70% of its EBITDA was derived from third-party business, highlighting a significant expansion beyond its initial captive market.

Delek Logistics' sales and marketing strategy is deeply rooted in its B2B focus, leveraging its expanded infrastructure and service capabilities to attract and retain clients in the energy sector. The company emphasizes its role as a full-service provider, offering integrated solutions for crude oil, natural gas, and water management. This approach is supported by strategic asset development and operational excellence, particularly in key regions like the Permian Basin and Gulf Coast. Understanding the broader market dynamics is crucial, as detailed in our Delek Logistics PESTEL Analysis.

Delek Logistics Partners, LP primarily employs a direct sales approach, leveraging long-term, fee-based contracts to serve its business-to-business clientele. This strategy focuses on building and maintaining strong relationships with key industry participants.

Direct Sales and Contractual Agreements

The company's sales strategy is centered on direct engagement with customers, including its parent company and a growing base of third-party producers and refiners. Long-term contracts with minimum volume commitments are a cornerstone of this approach, ensuring stable revenue streams.

Diversification and Third-Party Growth

There has been a strategic emphasis on reducing reliance on its parent company and expanding its third-party business. This is reflected in the pro-forma third-party EBITDA contribution, which reached approximately 70% as of Q4 2024 and Q1 2025.

Key Partnerships and Acreage Dedication

Central to its growth are key partnerships and exclusive distribution deals. Long-term acreage dedication and crude oil gathering agreements, such as the 12-year agreement for an additional 50,000 acres in the Permian Basin announced in October 2024, are vital.

Service Integration and Acquisitions

Acquisitions, like H2O Midstream in September 2024 and Gravity Water Midstream in January 2025, have expanded its service offerings. This allows for a more integrated suite of midstream services, attracting new customers and solidifying existing relationships.

Delek Logistics Sales Approach for Midstream Services

The company's sales and marketing strategy for midstream services is built on providing essential logistics solutions. These include gathering, pipeline transportation, storage, wholesale marketing, terminalling, and water disposal and recycling for crude oil, refined products, and natural gas.

• Direct engagement with B2B customers.
• Long-term, fee-based contracts with minimum volume commitments.
• Strategic expansion of third-party business.
• Integration of services through acquisitions to enhance customer value.
• Focus on building robust relationships with producers and refiners.

The Marketing Strategy of Delek Logistics is a key component of its overall business strategy, aiming for sustained revenue growth and increased market share through targeted customer acquisition and strong partnership strategies.

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The sales and marketing strategy for Delek Logistics Partners, LP is deeply rooted in its business-to-business operations within the energy logistics sector. The company focuses on building awareness and generating leads through targeted digital and content-driven approaches, rather than broad consumer advertising.

Corporate Online Presence

Delek Logistics maintains a robust corporate website as its primary digital platform. This site is essential for investor relations, providing access to SEC filings, including the 2024 Annual Report on Form 10-K filed in February 2025, and company news.

Content Marketing Focus

Key content marketing efforts include investor presentations and press releases that detail financial performance, such as the Q2 2025 record net income of $44.6 million and Adjusted EBITDA of $120.9 million. These materials emphasize operational efficiency and strategic growth.

Analyst and Investor Engagement

While not traditional influencer marketing, collaborations with financial analysts and participation in investor conferences are vital. These activities shape market perception and are crucial for attracting capital investment.

Data-Driven Market Analysis

The company utilizes data for market analysis, identifying growth opportunities in regions like the Permian Basin. Operational data is leveraged to refine service offerings and demonstrate reliability, supporting its Delek Logistics sales strategy.

Expanded Capabilities Marketing

Marketing efforts highlight expanded capabilities, particularly after acquisitions integrating water management services. This allows for cross-product sales and increased operational synergies, contributing to Delek Logistics revenue growth.

Strategic Positioning

The Delek Logistics business strategy emphasizes its strategic positioning in key energy basins. This focus is communicated through various channels to attract and retain clients in the competitive midstream sector.

The Delek Logistics marketing strategy is designed to communicate its value proposition to a sophisticated audience of investors and business partners. This involves showcasing financial strength, operational excellence, and strategic growth initiatives. The company's approach to market segmentation for services is evident in how it tailors its communications to highlight specific benefits for different client needs within the energy logistics chain. Understanding the Competitors Landscape of Delek Logistics is also integral to refining its sales approach for midstream services and increasing pipeline throughput.

Key Marketing and Sales Tactics

Delek Logistics employs a multi-faceted approach to its sales and marketing, focusing on demonstrating value and reliability to its B2B clientele.

• Digital Presence: Maintaining a comprehensive corporate website for investor relations and corporate information.
• Content Dissemination: Utilizing investor presentations, press releases, and financial reports to communicate performance and strategy.
• Financial Community Engagement: Collaborating with financial analysts and participating in investor conferences to shape market perception.
• Data-Driven Insights: Leveraging market and operational data to identify growth opportunities and optimize service offerings.
• Capability Showcasing: Highlighting expanded services, such as water management, to drive cross-product sales and synergies.
• Strategic Communication: Emphasizing strategic positioning in key energy basins to attract business partners.

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The brand positioning of Delek Logistics Partners, LP centers on being a dependable, efficient, and strategically situated midstream energy infrastructure provider. This is achieved through operational excellence and an expanding range of services, emphasizing safe and reliable transportation and storage for crude oil, refined products, natural gas, and water, particularly in key regions like the Permian Basin and Gulf Coast.

Reliability and Efficiency Focus

The company's core message highlights its commitment to delivering essential, safe, and reliable transportation and storage solutions. This focus on operational excellence underpins its brand as a trusted partner in the energy sector.

Strategic Geographic Advantage

Delek Logistics emphasizes its strategic location in critical energy-producing regions, particularly the Permian Basin and Gulf Coast. This geographic advantage is a key component of its value proposition for producers and investors alike.

Professional Brand Identity

The brand's visual identity and communication style are professional, conveying stability and growth. This consistent tone across corporate materials reinforces its image as a stable investment and a reliable service provider.

Integrated Asset Base and Fee-Based Contracts

The company appeals to its target audience by showcasing its integrated asset base and long-term, fee-based contracts. These elements provide predictable revenue streams, a key attraction for investors seeking stable returns.

Delek Logistics' brand positioning is further strengthened by its strategic growth and diversification. While its relationship with Delek US Holdings remains important, the expansion of its third-party customer base demonstrates growing market independence and broader appeal. The company's recent strategic acquisitions, including the $230 million H2O Midstream deal in September 2024 and the $285 million Gravity Water Midstream acquisition in January 2025, are pivotal in reinforcing its brand as a comprehensive midstream leader. These acquisitions significantly broaden its service offerings to include full-cycle water management solutions, aligning with industry trends towards greater sustainability and operational efficiency, thereby enhancing its brand perception and market position.

Diversification into Water Midstream

The strategic acquisitions of H2O Midstream and Gravity Water Midstream highlight a deliberate move to diversify services. This expansion into water management solutions positions the company as a more comprehensive energy logistics provider.

Alignment with Industry Trends

By integrating water management services, the company aligns its brand with growing industry emphasis on sustainability and operational efficiency. This strategic direction appeals to stakeholders increasingly focused on environmental, social, and governance (ESG) factors.

Strengthening Third-Party Relationships

The growing third-party customer base, alongside its foundational relationship with Delek US Holdings, showcases the company's ability to attract and serve a diverse market. This broadens its revenue base and enhances its market resilience.

Investor Appeal Through Predictable Revenue

The emphasis on an integrated asset base and long-term, fee-based contracts is a core element of its brand positioning for investors. This structure provides a degree of revenue predictability, crucial for attracting capital in the midstream sector.

Competitive Differentiation

Delek Logistics differentiates itself through operational excellence and a diversified service portfolio, particularly its integrated water solutions. This multi-faceted approach sets it apart in a competitive midstream landscape.

Brand Messaging Consistency

The brand's consistent messaging across its corporate website and investor communications reinforces its image of stability, growth, and commitment. This unified approach is vital for building trust and maintaining a strong brand identity.

Key Pillars of Brand Positioning

Delek Logistics' brand positioning is built upon several key pillars that define its market identity and appeal to its target audience:

• Reliability and Efficiency: Delivering safe and dependable midstream services.
• Strategic Location: Leveraging prime positions in the Permian Basin and Gulf Coast.
• Operational Excellence: Maintaining high standards in all logistics operations.
• Diversified Service Portfolio: Expanding beyond traditional oil and gas to include water management.
• Financial Stability: Offering predictable revenue streams through fee-based contracts.
• Commitment to Stakeholders: Fostering trust through professional communication and consistent performance.

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Delek Logistics Partners, LP's sales and marketing strategy is characterized by strategic business development and investor relations initiatives focused on asset growth and operational achievements. These efforts aim to communicate the value proposition of their expanding midstream services.

Water Management Expansion Campaign

A significant campaign involved the aggressive expansion into water management services, initiated with the H2O Midstream acquisition for $230 million in September 2024. This move aimed to establish Delek Logistics as a comprehensive midstream provider by integrating water gathering, transportation, recycling, storage, treatment, and disposal.

Gravity Water Midstream Acquisition

Further solidifying the water management strategy, the Gravity Water Midstream acquisition closed in January 2025 for $285 million. This initiative focused on enhancing cost efficiencies and revenue synergies through streamlined operations and cross-product sales in the Permian Basin.

Gas Processing Plant Expansion Campaign

Another key initiative is the expansion of the Libby 2 gas processing plant and the development of Acid Gas Injection (AGI) capabilities. The successful completion of the Libby 2 plant by Q2 2025 boosted processing capacity for regional producers.

Capital Deployment for Growth

These strategic expansions were supported by capital deployment initiatives, including a $150 million common unit offering in October 2024. These efforts underscore a commitment to funding accretive growth projects and long-term value creation.

The communication for these campaigns primarily utilized press releases, SEC filings, investor presentations, and financial news outlets. The objective was to highlight the strategic benefits of enhanced service offerings, sustainability focus, and anticipated cost synergies, thereby supporting the Delek Logistics sales strategy and overall business strategy.

H2O Midstream Acquisition Impact

The H2O Midstream acquisition contributed to Delek Logistics' Q4 2024 Adjusted EBITDA of $107.2 million. It also played a role in increasing third-party EBITDA contribution to approximately 70% pro-forma.

Gravity Water Synergy Focus

The Gravity Water Midstream acquisition emphasized synergistic integration with the H2O Midstream deal, focusing on crude and produced water gathering and disposal in the Permian Basin.

Libby 2 Plant Capacity Boost

The Libby 2 gas processing plant expansion in Lea County, New Mexico, successfully boosted processing capacity for regional producers, as highlighted in Q2 2025 financial results.

Public Offerings for Funding

Public offerings, such as the $150 million common unit offering in October 2024, were crucial for funding accretive growth projects, demonstrating a clear capital allocation plan.

Strategic Market Positioning

These campaigns collectively aim to position Delek Logistics as a diversified and integrated midstream service provider, enhancing its market share and revenue growth potential.

Investor Relations Emphasis

Investor relations efforts are central to these campaigns, communicating the strategic rationale and financial benefits of expansion and operational improvements to stakeholders.

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