MIDLAND, TEXAS– July 10, 2018 – Oryx Midstream Services II, LLC announced today that its operating subsidiaries, Oryx Delaware Oil Gathering NM LLC, Oryx Delaware Oil Gathering TX LLC, Oryx Western Delaware Oil Gathering LLC and Oryx Delaware Oil Transport LLC (collectively, “Oryx”), have launched a joint binding open season to secure volume commitments and/or acreage dedications to support the previously-announced regional crude oil gathering and trunk line transportation systems, which will serve the liquids-rich Delaware Basin in Texas and New Mexico. The binding open season commenced today, July 10, 2018 at 8 a.m. CDT and is scheduled to conclude at 5 p.m. CDT on August 9, 2018.
Based on customer demand, Oryx has expanded the scope of the original project to include additional capacity and a larger footprint across the Delaware Basin. The new system is expected to consist of approximately 400 miles of new gathering and transportation pipeline, with approximately 650,000 barrels per day of throughput capacity and more than 1.5 million barrels of storage capacity. The new gathering and transportation system will span the Delaware Basin and is expected to provide services to Lea and Eddy counties in New Mexico and Loving, Reeves, Ward, Winkler and Culberson counties in Texas. A map of the new system can be found here.
Construction on the new system has begun and the regional transportation pipeline, which will connect Oryx’s Carlsbad station to the Crane and Midland market hubs, is expected to be fully commissioned during the fourth quarter of this year. The full system is expected to be complete in the second quarter of 2019. Upon completion, and when combined with Oryx Midstream Services, LLC’s assets (operated by Oryx Southern Delaware Oil Gathering and Transport LLC), Oryx’s total Delaware Basin system capacity will exceed 850,000 barrels per day.
“We are pleased to launch this open season to support the construction of incremental transportation and gathering capacity in the rapidly expanding Delaware Basin. The new system extension and storage footprint allows us to provide crude oil segregation and connectivity for our customers in the Texas and New Mexico areas of the northern Delaware Basin to multiple takeaway options, providing the flexibility and market opportunities they need to maximize the value of their production,” said Brett Wiggs, Oryx Midstream Services’ chief executive officer. “Rapid production growth has increased the need for access to gathering capacity and more efficient transportation logistics across the basin. We are focused on the execution of this project in the proposed timeframe to provide our customers with much-needed relief from rate variability and administrative and operational burdens associated with trucking alternatives.”
Open Season Information
The binding open season process provides potential shippers with the opportunity to make volume commitments or acreage dedications to Oryx Delaware Oil Gathering NM LLC, Oryx Delaware Oil Gathering TX LLC and Oryx Western Delaware Oil Gathering LLC and or Oryx Delaware Oil Transport LLC by executing gathering and/or transportation services contracts with Oryx. Shippers that elect to make commitments to Oryx Delaware Oil Transport LLC during the open season for movements on the trunk line will receive firm transportation for their committed volumes. Shippers that elect to make commitments to Oryx Delaware Oil Gathering NM LLC, Oryx Delaware Oil Gathering TX LLC and or Oryx Western Delaware Oil Gathering LLC during the open season for movements on any of the gathering systems will receive firm gathering service for their committed volumes. Shippers that receive firm service will be required to pay a premium rate compared to the rate offered to similarly-situated walk-up shippers.
A copy of the Open Season notice, which provides a high-level summary of the key terms set forth in the gathering and transportation services contracts can be found at Oryx’s website http://www.oryxmidstream.com/customer-center. Copies of the Open Season procedures and the gathering and transportation services contracts will be available to interested shippers upon the execution of a confidentiality agreement, a copy of which shall be provided upon request. All binding commitments must be received by 5 p.m. CDT on August 9, 2018.
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About Oryx Midstream Services II, LLC
Midland-based Oryx Midstream II is focused on developing midstream infrastructure in the Permian Basin in New Mexico and Texas. Led by an experienced team with more than 160 years of experience in the oil and gas industry, Oryx is dedicated to providing producers with solutions and flexibility through a full suite of midstream services. Oryx is supported by a consortium of capital providers including Quantum Energy Partners, Post Oak Energy Capital, Wells Fargo Energy Capital, local Midland investors and others who collectively have contributed significant capital to the venture. For more information visit www.oryxmidstream.com.
About Quantum Energy Partners
Quantum Energy Partners is a leading provider of private equity capital to the global energy industry, having managed together with its affiliates more than $15 billion in equity commitments since inception. For more information on Quantum, please visit www.quantumep.com. For investor relations, please contact Michael Dalton at (713) 452-2000.
About Post Oak Energy Capital
Post Oak, which was established in 2006, is an energy-focused private equity firm based in Houston. Its management team has executive management experience and a broad network in the energy business as well as significant expertise in private equity investments, operations, development, finance, acquisitions and divestitures. The firm pursues private equity investments primarily in the upstream sector of the oil and gas industry in North America and, to a lesser extent, in oil field services and related infrastructure. Post Oak works in close partnership with operating management teams to build businesses, accelerate growth and enhance shareholder value. Post Oak’s website is www.postoakenergy.com.
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