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Medallion announces binding open season for expansion of crude oil pipeline

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World Pipelines,

Medallion Pipeline Company, LLC has announced a binding open season to solicit long-term, firm shipper commitments for an expansion of its crude oil pipeline system in the Midland Basin. Through the open season, Medallion proposes to expand two pipeline segments to transport increased quantities of crude oil, produced from acreage proximate to Medallion’s system, to downstream pipelines and markets.

The existing Medallion pipeline system

The existing Medallion pipeline system consists of approximately 800 miles of 6 in. diameter and larger crude oil pipeline spanning some of the most prolific crude oil producing counties in the Permian Basin.1 The Medallion pipeline, which consists of eight pipeline segments located in Crane, Glasscock, Howard, Irion, Martin, Midland, Mitchell, Reagan, Scurry and Upton counties, all within the state of Texas, serves as an intrabasin header system providing diversified market access to ten downstream pipelines that interconnect with the Medallion system at Medallion’s Crane Hub, Midland Hub, and Colorado City Hub.

The expansion

To address the growing need for pipeline capacity in the region, Medallion plans to construct an operational loop of its existing Howard Lateral and an expansion of its Midkiff Lateral from the Garden City Station to the Midkiff Station. The open season provides an opportunity for interested shippers to acquire long-term firm capacity under binding transportation services agreements, as a committed firm shipper on one or both expansion segments.

Open season process

The open season began yesterday, 24 September 2019 and ends at 4.00 pm CDT, Friday 18 October 2019. All bids must be submitted during the open season, except as provided in the open season notice.

Existing committed firm shippers will be provided the option to participate in the open season to 1) amend an existing transportation services agreement for transportation on the Howard Lateral to obtain the lower expansion rates offered on the Howard expansion in return for an extension of the primary term of the existing transportation services agreement, and 2) add the Midkiff Station as a destination point to an existing transportation services agreement for committed firm transportation on the Midkiff Lateral.

Bona fide prospective shippers may obtain copies of the expansion transportation services agreements, as well as the proposed Federal Energy Regulatory Commission and Texas Railroad Commission tariffs by contacting the representative. Prospective shippers must execute a confidentiality agreement prior to delivery of these documents.

1 The Medallion pipeline system also includes pipeline facilities that are smaller than 6 in. in diameter, typically constructed to connect the system to individual tank batteries in the field.

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US pipeline news Crude oil pipeline news