Company News »

JP Energy Partners Announces Strategic Extension of its Silver Dollar Pipeline

Business Wire
Share on StockTwits
Published on

JP Energy Partners LP (“JP Energy”) (NYSE:JPEP) announced that it has signed a 10-year fee-based gathering agreement with Discovery Natural Resources LLC (“Discovery”) to construct and operate an extension of its Silver Dollar Pipeline crude oil gathering system into the core of the Midland Basin. The agreement with Discovery is supported by a dedication of 53,000 acres in Reagan, Glasscock, Sterling and Irion Counties. In addition to pipeline gathering, JP Energy will also provide crude oil trucking, marketing and related services for Discovery.

“The Midland Basin is a key area of focus for JP Energy, and we believe that our Silver Dollar Pipeline is a strategic and well-positioned crude oil gathering system. We are excited to use the market knowledge we have gained through our existing operations in the Permian Basin and Eagle Ford to partner with Discovery and further expand our comprehensive crude oil midstream solution,” stated J. Patrick Barley, CEO of JP Energy. “We expect that as Discovery and other producers continue to develop the Spraberry, Wolfberry and Wolfcamp plays of the Midland Basin, JP Energy’s locational advantages and broad range of logistical capabilities will prove valuable to both the producer community and downstream customers in the crude oil markets.”

The gathering system extension will consist of approximately 55 miles of pipeline, extending from southern Reagan County north into Glasscock County across some of the most prolific drilling areas of the Midland Basin. The project, with an estimated capital cost of approximately $36mm, is expected to be completed in the second half of 2015. The project will be accretive to distributable cash flow per unit upon completion and will initially be funded using our revolving credit facility.

About JP Energy Partners LP

JP Energy Partners LP (JPEP) is a publicly traded, growth-oriented limited partnership that owns, operates, develops and acquires a diversified portfolio of midstream energy assets. Our operations currently consist of: (i) crude oil pipelines and storage; (ii) crude oil supply and logistics; (iii) refined products terminals and storage; and (iv) NGL distribution and sales, which together provide midstream infrastructure solutions for the growing supply of crude oil, refined products and NGLs in the United States. To learn more, please visit our website at www.jpenergypartners.com.

About Discovery Natural Resources

Discovery Natural Resources is a private exploration and production company headquartered in Denver and operating in Texas, Kansas, Utah and Colorado. Since its inception a decade ago, it has assembled nearly 300,000 net acres in both conventional and unconventional plays. The company’s operations represent a mix of development and exploration opportunities with oil, natural gas and natural gas liquids reserves. To learn more, please visit their website at www.discoverynr.com.

Forward looking statements

This press release may include forward-looking statements within the meaning of the federal securities laws. Statements that do not relate strictly to historical or current facts are forward-looking. These statements contain words such as “possible,” “if,” “will” and “expect” and involve risks and uncertainties including, among others, that JP Energy’s business plans may change as circumstances warrant. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in each of JP Energy’s documents and reports filed with the Securities and Exchange Commission. Any forward-looking statement applies only as of the date on which such statement is made and JP Energy undertakes no obligation and does not intend to correct or update these forward-looking statements to reflect events or circumstances occurring after this press release except as required by law. You are cautioned not to place undue reliance on these forward-looking statements.

Share on StockTwits