Kingfisher Midstream, LLC (“Kingfisher Midstream”), a wholly owned
subsidiary of Alta Mesa Resources, Inc. (“Alta Mesa”) (NASDAQ:AMR),
Blueknight Energy Partners, L.P. (“BKEP”) (NASDAQ:BKEP)
(NASDAQ:BKEPP), and affiliates of Ergon, Inc. (“Ergon”; Private),
today announced the execution of definitive agreements to form
Cimarron Express Pipeline, LLC (“Cimarron Express”). The venture
will include the construction and operation of a new crude oil
pipeline serving STACK producers in central Oklahoma with a new
65-mile, 16-inch crude oil pipeline extending from northeastern
Kingfisher County, Oklahoma, to BKEP’s Cushing, Oklahoma, crude oil
terminal. The pipeline will provide direct market access at Cushing
for producers and will have an initial capacity of 90,000 barrels
per day, expandable to over 175,000 barrels per day. The new
pipeline is expected to be completed in mid-2019.
The ownership of Cimarron Express will be 50% Kingfisher
Midstream and 50% Ergon. Ergon, owner of the general partner of
BKEP, will hold its ownership in Cimarron Express through a newly
created, wholly owned subsidiary, ERGON – OKLAHOMA PIPELINE, LLC
(“Devco”). Ergon and BKEP also entered into an agreement that gives
each party rights concerning the purchase or sale of Devco, subject
to certain terms and conditions.
Concurrent with the formation of Cimarron Express, Alta Mesa
executed a long-term acreage dedication and transportation
agreement with Cimarron Express, which incorporates approximately
120,000 net acres in Kingfisher and Garfield counties.
Under the terms of the agreement, BKEP will construct and
operate the pipeline. Also, BKEP will continue to operate its
existing crude oil storage facilities in Cushing, Oklahoma. The
receipt terminal for the newly constructed Cimarron Express
pipeline will be located at Kingfisher Midstream’s crude oil
storage facility located in northeastern Kingfisher County. The
pipeline will connect to Kingfisher Midstream’s crude oil gathering
system and truck unloading facilities at the Kingfisher Midstream
crude oil facility.
“We are excited to participate in this project which will
provide direct market access to the Cushing Oil Terminal for STACK
producers and afford them the opportunity to maximize the value of
their crude oil production,” added Craig Collins, COO of Kingfisher
Midstream. “We also see long-term value in this project for
Kingfisher Midstream as we aggregate STACK oil volumes on our crude
gathering system to deliver to Cimarron Express.”
“We are pleased to be participating in this important project
with a leader in the development of the prolific STACK production
area in Oklahoma,” commented Mark Hurley, CEO of BKEP. “This
pipeline will create a direct connection to our storage assets at
our Cushing Crude Oil Terminal, enabling Alta Mesa Resources and
other STACK producers to efficiently and safely move their
production to the market. The addition of this pipeline underscores
our commitment to work with exploration and production companies to
build the needed infrastructure to support their capital
investments. We are also happy to be working with Ergon, the owner
of our general partner, who is supporting this project through the
Devco structure. It is another example of the strategic
relationship we envisioned when Ergon purchased our general partner
in 2016.”
“This venture continues Ergon’s support of BKEP and our 64-year
history of operations in the crude oil and petroleum market,”
commented Emmitte Haddox, Ergon CEO. “As BKEP’s general partner, we
are excited about working with Alta Mesa Resources on this project
that will create value not only for our companies, but for other
STACK producers, customers, and the communities in which we
operate.”
About Alta Mesa Resources, Inc., and Kingfisher
Midstream, LLCAlta Mesa Resources, Inc., is an independent
energy company focused on the development and acquisition of
unconventional oil and natural gas reserves in the Anadarko Basin
in Oklahoma, and through Kingfisher Midstream, LLC, provides
best-in-class midstream energy services, including crude oil and
gas gathering, processing and marketing to producers in the STACK
play. For more information, please visit http://altamesa.net/.
Alta Mesa Contact: Lance L. Weaver(281)
943-5597 lweaver@altamesa.net
About Blueknight Energy Partners, L.P.BKEP owns
and operates a diversified portfolio of complementary midstream
energy assets consisting of:
- 10.4 million barrels of liquid asphalt storage located at 56
terminals in 26 states;
- 6.9 million barrels of above-ground crude oil storage capacity,
approximately 6.6 million barrels of which are located at the
Cushing Interchange terminalling facility in Cushing,
Oklahoma;
- 655 miles of crude oil pipeline located primarily in Oklahoma;
and
- 65 crude oil transportation vehicles deployed in Kansas,
Oklahoma and Texas.
BKEP provides integrated terminalling, gathering and
transportation services for companies engaged in the production,
distribution and marketing of liquid asphalt and crude
oil. BKEP is headquartered in Oklahoma City, Oklahoma. For
more information, visit BKEP’s web site at www.bkep.com.
BKEP Investor Relations: 918-237-4032;
investor@bkep.com or Media Contact: Brent Gooden,
405-715-3232 or 405-818-1900
About ErgonErgon is a group of privately held
companies that operate under six primary business segments:
Refining & Marketing, Asphalt & Emulsions, Transportation
& Terminaling, Oil & Gas, Real Estate and Corporate &
Other. For more information, visit Ergon’s website at
www.ergon.com.
Ergon Contact:Kathy PottsDirector of Marketing
CommunicationsErgon, Inc.601-933-3000kathy.potts@ergon.com
Safe Harbor Statement and DisclaimerThe information in this
press release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
All statements, other than statements of present or historical fact
included in this press release, regarding strategy, completion
date, pipeline capacity, future operations, prospects, plans and
objectives of management are forward-looking statements. When used
in this press release, the words “could”, “should”, “will”, “may”,
“believe”, “anticipate”, “intend”, “estimate”, “expect”, “project,”
and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
such identifying words. These forward-looking statements are based
on current expectations and assumptions about future events and are
based on currently available information as to the outcome and
timing of future events. These forward-looking statements are
subject to risks and uncertainties, most of which are difficult to
predict and many of which are beyond our control. Except as
otherwise required by applicable law, each company disclaims any
duty to update any forward-looking statements, all of which are
expressly qualified by the statements in this section, to reflect
events or circumstances after the date of this press release.
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