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Medallion closes open season for major crude oil pipeline expansion

Published by
World Pipelines,

Medallion Pipeline Company, LLC (Medallion), a subsidiary of Medallion Midstream LLC, has announced the successful closing of its binding open season for a major expansion of its existing crude oil pipeline system in the Midland Basin (the expansion).

As previously announced, the expansion will nearly double the capacity of Medallion’s existing Wolfcamp Connector mainline system through a partial loop of the Wolfcamp Connector system (the Wolfcamp Expansion) and will increase the capacity of the existing Howard Lateral (the Howard Expansion). The Wolfcamp Expansion will increase the existing capacity on the Wolfcamp Connector from 105 000 - 200 000 bpd and the Howard Expansion will increase the capacity of the existing Howard Lateral from 60 000 - 85 000 bpd.

Based on the binding capacity bids received during the open season, Medallion has executed a long term Transportation Services Agreement sufficient to move forward with the construction of the expansion. In addition, one existing committed shipper on the Wolfcamp Connector has agreed to extend its current Transportation Services Agreement to obtain the benefit of the expansion rate. Once complete, the expansion will provide much-needed capacity to transport crude oil produced in the Midland Basin to downstream pipelines and markets. The expansion is expected to commence partial commercial operations in the third quarter of 2017 and full commercial operations in the fourth quarter of 2017.

“The response to the open season and the continued interest of potential shippers in increased pipeline capacity in the Midland Basin is compelling,” said Randy Lentz, Medallion CEO. “We are excited about the significant production growth in the Midland Basin and the opportunity to meet our customers’ growing needs.”

Because of the significant interest expressed by potential shippers during the open season, and based on ongoing discussions with potential shippers, Medallion is conducting a supplemental open season to solicit additional binding long term commitments for a further expansion of the Medallion system. The supplemental open season maintains the same transportation options, the same origin and destination points, and the same rates as proposed in the open season, but provides a further opportunity to increase the capacity beyond the levels originally proposed in the open season. The supplemental open season provides an opportunity for interested shippers to acquire long term firm capacity, under minimum 10 year term Transportation Services Agreements and other eligibility requirements, as a committed firm shipper on either the Wolfcamp Expansion, the Howard Expansion, or both. The supplemental open season opens on 15 June 2017, and will close as of 4:00 p.m. CDT on 30 June 2017. All bids must be submitted to Medallion during the supplemental open season. Bona fide prospective shippers may obtain copies of the Transportation Services Agreement, as well as the proposed Federal Energy Regulatory Commission and Texas Railroad Commission tariffs by contacting the Medallion representative listed below. Medallion requires a prospective shipper to execute a Confidentiality Agreement prior to delivery of these documents.

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