DALLAS, June 10, 2014 /PRNewswire/ -- Summit
Midstream Partners, LLC ("Summit Investments"), the privately held
company that owns and controls the general partner of Summit
Midstream Partners, LP (NYSE: SMLP) and also owns a 56.8% limited
partner interest in SMLP, today provided a commercial update for
its wholly owned operating subsidiary, Meadowlark Midstream
Company, LLC ("Meadowlark"), and announced the development of a new
oil, gas and water gathering system by its new, wholly owned
operating subsidiary, Tioga Midstream, LLC ("Tioga
Midstream"). Meadowlark is composed of the Divide Crude Oil
& Water Gathering System (the "Divide System") and the Polar
Crude Oil & Water Gathering System (the "Polar System"), both
of which are located in the Bakken Shale Play in North
Dakota. Meadowlark also owns the Niobrara Gathering &
Processing System, which is located in the Denver-Julesburg Basin
in Weld County, CO.
Collectively, the four new development projects represent
approximately $300 million of future
capital expenditures. These projects will expand Summit
Investments' crude oil, water and associated natural gas gathering
footprint in Williams and
Divide counties in North Dakota and will provide its customers
with additional interconnects to help maximize the value of the
crude oil gathered by each of Summit Investments' Bakken Shale
gathering systems.
A summary of each of the development projects is provided
below:
Tioga Midstream / Commercial Update – Summit Investments'
newly formed, wholly owned subsidiary, Tioga Midstream, has agreed
with a subsidiary of a leading independent Bakken producer to
develop new crude oil, water and associated natural gas gathering
infrastructure serving its acreage located in Williams County, North Dakota. Under
this new arrangement, Tioga Midstream will construct over 240 miles
of new pipeline and is expected to have total system capacity of
20,000 barrels per day ("BPD") of crude oil, 25,000 BPD of water,
and 14 million cubic feet per day of associated natural gas under a
10-year, fee-based gathering agreement that includes an acreage
dedication of 114,000 acres.
This new pipeline system will reduce flaring in North Dakota as it gathers natural gas in an
area that is remote from existing infrastructure and moves it to
the producer's owned and operated natural gas processing plant in
the Bakken Shale. In addition to providing a more economical
and efficient gathering solution, the crude oil and water pipeline
infrastructure is intended to reduce the number of trucks on
North Dakota's roads and
highways.
Divide System Commercial Update (Samson) – During
the first quarter of 2014, Meadowlark executed a new, long-term
crude oil transportation agreement with Samson Resources Company
("Samson") to provide crude oil transportation for its Ambrose Field acreage located in Divide County, North Dakota. Meadowlark
is currently in the process of expanding the Divide System
footprint by installing crude oil pipeline infrastructure to
connect certain Samson wells currently being serviced by
trucks. Summit Investments expects first crude oil throughput
from Samson in the third quarter of 2014.
Stampede Rail Connection – Meadowlark has executed
definitive documentation with Global Partners LP ("Global") whereby
Meadowlark has agreed to construct a new crude oil truck unloading
station, including 55,000 barrels of crude oil tankage on the
Divide System, as well as a new 47-mile crude oil pipeline serving
Global's 270,000 barrel crude oil storage facility at Basin
Transload's Stampede rail terminal located in Burke County, North Dakota. Crude
oil delivered to this rail terminal has single line haul rail
access to Global's Albany, New
York terminal and can also access other rail-serviced
terminals throughout the United States.
With this project, Meadowlark will provide its customers with a
new interconnect for up to 50,000 BPD of crude oil deliverability,
providing optionality to access new downstream markets on both the
East and West Coasts. The project is also designed to attract
incremental crude oil production that is currently being trucked
from pad sites located in Divide
County, North Dakota. Once on Meadowlark's pipeline
infrastructure, customers will have direct access to the COLT Hub
rail terminal and the Stampede rail terminal.
Kodiak Oil & Gas Corp. ("Kodiak") Gathering
Expansion – Meadowlark has agreed with Kodiak to
significantly expand the Polar System located in Williams County, North Dakota. Pursuant
to the terms of a new amended gathering agreement, Meadowlark will
expand the Polar System to connect over 60 possible pad sites that
Kodiak expects to develop in its Polar Field over the next several
years. With this expansion, Meadowlark will more than double
the number of pad site receipt points that are currently connected
to the Polar System and significantly increase the volume of crude
oil and produced water it gathers from this field.
Steve Newby, President and CEO of
Summit Investments commented, "Today we announced a variety of new
organic development projects that we expect will further enhance
Summit's position as a leading, independent midstream provider in
the Bakken Shale. Within three months of executing the
$305 million Red Rock drop down from Summit Investments to
SMLP, our commercial team has worked to replace the value of that
asset by working with our existing Bakken customers to meet their
growing needs and with new producers located in close proximity to
our existing crude oil and water gathering infrastructure to expand
Summit Investments' operating footprint."
"I am pleased to welcome three new customers and to announce a
significant expansion of our strong existing relationship with
Kodiak. I am particularly excited about the new Tioga Midstream
development project which involves a coordinated effort by Summit
Investments to concurrently develop an integrated crude oil,
natural gas, and water gathering system for a large, independent
Bakken producer."
About Summit Midstream Partners, LLC
Summit Midstream Partners, LLC ("Summit Investments") indirectly
owns a 56.8% limited partner interest in SMLP and indirectly owns
and controls the general partner of SMLP, Summit Midstream GP, LLC,
which has sole responsibility for conducting the business and
managing the operations of SMLP. Summit Investments owns,
operates and is developing various crude oil, associated natural
gas, and water-related midstream energy infrastructure assets in
the Bakken Shale in North Dakota
and in the DJ Niobrara Shale in Colorado. Summit Investments is also
developing natural gas gathering and condensate stabilization
infrastructure in the Utica Shale in southeastern Ohio under a joint venture agreement with
affiliates of MarkWest Energy Partners, L.P. and The Energy &
Minerals Group. Summit Investments is a privately held
company owned by members of management, funds controlled by Energy
Capital Partners II, LLC, and GE Energy Financial Services, Inc.
and certain of its affiliates.
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SOURCE Summit Midstream Partners, LP