Medallion Announces Binding Open Season for New Delaware Basin Crude Oil Pipeline, Joint Tariff Service and Solicitation of Capacity Turnback
Medallion Delaware Express, LLC (Delaware Express) and Medallion
Pipeline Company, LLC (Medallion) are conducting an open season to
solicit binding, long-term commitments to support a new crude oil
pipeline system in the Delaware Basin in west Texas, and a new joint
transportation service to be provided by Delaware Express and Medallion.
Through this binding open season, Delaware Express and Medallion expect
to make up to 200,000 barrels per day (bpd) available for Joint Tariff
service, with up to 180,000 bpd available to committed shippers at
volume incentive rates under long-term transportation agreements
(Transportation Services Agreements), providing for either acreage
dedications or volume commitments. The proposed Joint Tariff service
will provide a critical link between new crude oil production in the
prolific Delaware Basin and multiple market centers and long-haul
pipelines connected to Medallion’s system.
About the Delaware Express Pipeline
The Delaware Express pipeline system will be a new crude oil gathering
and transportation system in Ward, Pecos, Reeves and Crane counties to
connect southern Delaware Basin crude oil to downstream pipelines,
including Medallion. Subject to the outcome of this open season,
Delaware Express will initially construct a 30-mile gathering system and
a 63-mile, 16-inch mainline pipeline with an initial capacity of 90,000
bpd, originating in Ward County and extending east to an interconnection
with Medallion in Crane County. Depending on the level of capacity
subscriptions awarded through the open season, the gathering system and
mainline will expand over time through the addition of field lines,
gathering lines, pumping station horsepower, drag reducing agents,
and/or the looping of all or some portion of the mainline to meet
Delaware Express’ contractual obligations under the Transportation
Services Agreements and to connect the acreage dedicated through the
open season process.
About Medallion Pipeline
The existing Medallion pipeline is a network of approximately 600 miles
of 6-inch and larger crude oil pipeline located in Martin, Howard,
Mitchell, Midland, Glasscock, Crane, Upton, Reagan and Scurry counties
in the Midland Basin. Initially placed in service in October 2014,
Medallion has undertaken a series of expansions to meet the increasing
needs of producers and marketers in the region. Through the Joint Tariff
service, Medallion will receive crude oil from Delaware Express at the
interconnection between Delaware Express and Medallion near Medallion’s
Crane Hub. Medallion will deliver crude oil transported under the Joint
Tariff at multiple hubs that interconnect with long-haul, large-volume
pipeline systems for transportation to downstream refinery markets.
Medallion will initially provide the Joint Tariff service through an
expansion of its system to be effectuated through the addition of
pumping facilities and possibly capacity temporarily or permanently
released from existing shippers, as explained below. Capacity additions
over the term of the Transportation Services Agreements to meet
Medallion’s contractual obligations may be achieved by the addition of
new or increased pumping station horsepower, drag reducing agents, the
looping of pipeline segments of the Joint Tariff route, and/or capacity
turnback, if any.
Medallion Solicitation of Turnback Capacity
Medallion is soliciting requests from existing shippers with effective
transportation services agreements along the Joint Tariff route to
temporarily or permanently turn back a portion of their capacity. This
would potentially defer or reduce the facilities initially required to
be constructed by Medallion to provide the Joint Tariff service. The
solicitation of turnback capacity is not binding on Medallion, and the
turnback of capacity will be determined by Medallion at its sole
discretion. Qualified shippers that are interested in potentially
turning back capacity must participate in the open season for that
purpose.
Open Season Process
The open season begins today, October 18, 2017 and ends at 5:00 pm CDT
on November 15, 2017. All bids for the Joint Tariff service and
expressions of interest regarding the potential turnback of capacity
must be submitted during the open season. Bona fide prospective shippers
may obtain copies of the Transportation Services Agreements, as well as
the proposed Federal Energy Regulatory Commission and Texas Railroad
Commission Joint Tariffs by contacting the representative listed below.
Prospective shippers must execute a confidentiality agreement prior to
delivery of these documents. More information concerning the Joint
Tariff service and the binding open season is available on the Medallion
website at www.medallionmidstream.com.
Interested shippers may contact the representative listed below for
further information.
About Medallion Midstream, LLC
Medallion Midstream is an Irving, Texas based full services midstream
provider specializing in the design, construction and operation of
natural gas and crude oil infrastructure. Medallion delivers responsive,
reliable and comprehensive services and solutions for its customers.
Medallion is a portfolio company of The Energy & Minerals Group. To
learn more about Medallion, please visit www.medallionmidstream.com.
About The Energy & Minerals Group
The Energy & Minerals Group (EMG) is the management company for a series
of specialized private equity funds. The Firm was founded by John
Raymond (majority owner and CEO) and John Calvert in 2006. EMG focuses
on investing across various facets of the global natural resource
industry including the upstream and midstream segments of the energy
complex. EMG has approximately $16.0 billion of regulatory assets under
management and approximately $10.4 billion in commitments have been
allocated across the energy sector since inception.
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