Tallgrass Energy Partners has announced two acquisitions by its Tallgrass Terminals business and several commercial developments that are expected to expand the variety of services offered by Pony Express in key crude oil producing basins it serves.
Tallgrass Terminals has entered into an agreement to acquire a 51% membership interest in the Pawnee crude oil terminal in Colorado, US from Zenith Energy for approximately US$31 million. The Pawnee terminal is an injection point for the Tallgrass Pony Express Northeast Colorado Lateral (NECL), with 300 000 bbl of storage and backed by minimum volume commitments of approximately 90 000 bpd. The Pawnee Terminal will offer the potential for incremental sourcing opportunities by connecting nearby producers. Tallgrass Terminals expects the transaction to close in 1Q18, subject to certain closing conditions.
Deeprock Development expansion
In addition, Tallgrass Terminals has acquired a 38% interest in Deeprock North, which owns a crude oil terminal in North Cushing, Oklahoma, US, immediately adjacent to the Deeprock Development crude oil terminal facility. The purchase price for the interest was US$19.5 million. Immediately following the acquisition, Deeprock North was merged into Deeprock Development, which now owns a larger and more diverse terminalling complex with total storage capacity of 4 million bbl. Tallgrass Terminals owns approximately 60% of the combined entity and retains significant strategic and commercial control.
Successful Platteville Extension open season
Pony Express recently concluded a successful binding open season to secure committed shipper contracts for crude oil transportation of a new common stream on the Platteville Extension. The open season resulted in additional unaffiliated third-party commitments of 10 000 bpd for a total of 37 500 bpd of short-haul and long-haul binding transportation commitments. The 55 mile Platteville Extension is approximately 60% complete and expected to begin operations in April 2018, with the associated Grasslands Terminal expected to be in service in 4Q18. The initial capacity of the Platteville Extension will be approximately 40 000 bpd, increasing to approximately 80 000 bpd once the Grasslands Terminal is in service.
January 2018 in-service of two new refinery connections expected
Construction on the Holly Frontier El Dorado and CHS McPherson, Kansas, US, refinery connections is complete, with line fill and commercial service expected in early January 2018 for both.
Once the two new refinery connections are in service, Pony Express shippers will deliver more than 300 000 bpd to three refineries directly connected to Pony Express, including the currently connected refinery in Ponca City, Oklahoma.
Read the article online at: https://www.tanksterminals.com/storage-tanks/05012018/tallgrass-announces-acquisitions/