Irving, Texas-based Medallion Pipeline Co. LLC announced a binding open season on July 16 to solicit long-term, firm shipper commitments for a major expansion of its crude oil pipeline system in the Midland Basin.
Through the open season, Medallion Pipeline proposes to expand six pipeline segments to transport increased quantities of crude oil, produced from acreage proximate to the company’s system, to downstream pipelines and markets. The open season will run until Aug. 15.
The expansion project is expected to commence commercial operations in phases, with full commercial operations expected during the fourth quarter of 2019.
To address the growing need for pipeline capacity in the Midland region, Medallion plans to construct a 16-in. operational loop of its existing Midkiff Lateral and plans to expand the capacity of the Crane Extension, Reagan Gathering Extension, Santa Rita Lateral, Martin Lateral and Midland Lateral. 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 more of the expansion segments. Prospective shippers are provided with two commitment tiers subject to a minimum five-year commitment.
Additionally, existing firm shippers will be provided the option to amend existing transportation services agreements, as set forth in the open season notice, to 1) adjust committed volumes or 2) obtain the lower expansion rates offered on the applicable expansion segments in return for an extension of the primary term of the agreement.
Initially placed in service in October 2014, Medallion’s crude oil pipeline has undertaken a series of expansions to meet the increasing needs of producers and marketers in the Midland Basin. The existing system is a network of approximately 700 miles of 6-in. and larger crude oil pipeline facilities that aggregate and transport crude oil production to the Colorado City Hub, the Crane Hub and the Midland Hub, providing access to multiple long-haul, large-volume pipelines for transportation to downstream markets.