Medallion Pipeline Company, LLC, a subsidiary of Medallion Midstream LLC, has launched a binding open season to solicit long-term firm shipper commitments for a major expansion of its existing crude oil pipeline system in the Midland Basin. The expansion will include two parts: the Wolfcamp Expansion, which will nearly double the capacity of Medallion’s existing Wolfcamp Connector mainline, and the Howard Expansion, which will increase the capacity of the existing Howard Lateral. These projects will enable Medallion to provide much-needed capacity to transport crude oil produced in the Midland Basin to downstream pipelines and markets.
The Wolfcamp Expansion includes a 16-inch partial loop of the Wolfcamp Connector mainline in Howard, Glasscock, Mitchell and Scurry counties in Texas. The Wolfcamp Expansion will begin at the existing Howard-Wolfcamp Interconnect and extend 47 miles to the Colorado City Hub, where Medallion interconnects with several third-party carriers. The Wolfcamp Expansion will increase the existing capacity on the Wolfcamp Connector mainline from 105,000 barrels per day to 200,000 barrels per day and provide firm shippers on the Wolfcamp Connector with multiple options for the receipt and delivery of crude oil.
The Howard Lateral Expansion will increase the existing 60,000-barrel-per-day capacity of the Howard Lateral to 85,000 barrels per day through the addition of pumping horsepower. Because of the bidirectional capabilities of the Howard Lateral, firm shippers on the Howard Expansion will have the flexibility to transport crude oil on several transportation paths.
The 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 Lateral or both. The open season also will offer existing firm shippers on the Wolfcamp Connector the option to amend their existing Transportation Services Agreements to obtain the lower Wolfcamp Expansion firm rate in return for an extension of the primary term of the Transportation Services Agreement commensurate with the minimum term required on the Wolfcamp Expansion.
The open season started on Tuesday, May 16, 2017, and ends at 5:00 pm CDT Friday, June 9, 2017. The overall expansion project is expected to start partial commercial operations in the third quarter of 2017 and full commercial operations in the fourth quarter of 2017.