Rockies Express Pipeline LLC (REX) and Tallgrass Energy Partners, LP, REX’s operator, announced that REX received the cash payment of US$150 million from Ultra Resources, Inc. (Ultra) in connection with the settlement of REX’s US$303 million breach of contract claim, and that REX has distributed the proceeds to its partners.
As previously disclosed, Ultra has agreed to enter into a new seven year firm transportation agreement with REX commencing 1 December 2019, for service from west to east of 200 000 dth/d at a rate of approximately US$0.37, or about US$26.8 million annually.
REX recently conducted several open seasons for incremental east to west capacity in Zone 3 totalling 180 000 dth/d from Clarington (Ohio) to delivery points as far west as Moultrie (Illinois). As a result of the open seasons, REX has entered into firm transportation contracts with a number of parties for varying volumes and terms that began as early as June 2017. REX currently expects 2017 revenue from those contracts to be at least US$13 million.
Tallgrass Energy plans to report second quarter 2017 financial results on Wednesday, 2 August 2017, after market close and hold a conference call at 3:30 p.m. Central Time that same day. Tallgrass Energy expects to provide additional details on these and other developments during the conference call on 2 August.
Read the article online at: https://www.worldpipelines.com/business-news/13072017/rex-and-tallgrass-receive-cash-settlement-payment-from-ultra/