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Tallgrass Energy Completes REX Zone 3 Capacity Enhancement Project

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Tallgrass Energy and Rockies Express Pipeline LLC (REX) announced Jan. 5 that the 0.8 billion cubic feet per day (Bcf/d) REX Zone 3 Capacity Enhancement Project is substantially complete and accepting nominations. REX’s Zone 3 continues to be capable of bidirectional natural gas transportation and can now move 2.6 Bcf/d of natural gas from Clarington, Ohio, to delivery points as far as Mexico, Missouri.

rexz3-3Zone 3 provides significant takeaway capacity for Appalachian natural gas along with flexible transportation routes through its 20 pipeline interconnects and delivery points. Zone 3 capacity from east-to-west is contracted at full capacity with a weighted average remaining contract life of 16 years as of Dec. 31, 2016.

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“The completion of the Capacity Enhancement Project marks another important milestone in the transformation of REX into the nation’s northernmost bi-directional natural gas header system,” said Matt Sheehy, Tallgrass senior vice president and chief commercial officer and REX president. “Our original Capacity Enhancement shippers saw the long-term value in the project over two years ago when they contracted with us. Since then, as others embraced the REX value proposition, we have steadily added incremental long-term customers to this project.”

Crystal Heter, REX vice president and general manager added, “We are pleased we delivered this significant capital project on time and at a cost that is expected to be less than our project budget.”

Tallgrass Energy is a family of companies that includes publicly traded partnerships Tallgrass Energy Partners LP and Tallgrass Energy GP LP, and privately held Tallgrass Development LP. Operating across 10 states, Tallgrass is a growth-oriented midstream energy operator with transportation, storage, terminal and processing assets that serve some of the nation’s most prolific crude oil and natural gas basins.

Rockies Express Pipeline is an approximately 1,712-mile natural gas transmission pipeline that extends from the Rocky Mountains to Clarington, Ohio. The system consists of 36- and 42-in. diameter pipe with a west-to-east long-haul design capacity of up to 1.8 Bcf/d of natural gas and an east-to-west design capacity of 2.6 Bcf/d within Zone 3 of the pipeline. In addition, REX has 0.6 Bcf/d of capacity on the Overthrust Pipeline available to it pursuant to a long-term lease.

Rockies Express Pipeline LLC is a joint venture of a subsidiary of Tallgrass Development (50 percent share), a subsidiary of Tallgrass Energy Partners (25 percent share) and P66REX LLC, a subsidiary of Phillips 66 (25 percent share). A wholly owned subsidiary of Tallgrass Energy Partners operates the pipeline.

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