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Tallgrass Developing DJ Basin Oil Terminal

Units of Tallgrass Energy Partners (TEP) on Monday forged an agreement with Saddle Butte Pipeline to develop an oil terminal in Platteville, CO, that would interconnect with the Denver-Julesburg (DJ) Basin crude oil gathering system.

Ultimately, the Tallgrass Grasslands Terminal plans to offer direct access to refining and Cushing, OK, hubs.

Tallgrass Terminals LLC (TTL) and Tallgrass Pony Express Pipeline are overseeing the plans, which call for building a complex tied to Saddle Butte’s DJ oil infrastructure with 80,000 b/d takeaway capacity.

Estimated cost and a timetable for the DJ facility won’t be available until an open season is concluded on July 17, a TEP spokesperson said Monday.

"We're still in the process of determining the scope and timing, so we'll know more once we have the results of the open season," she told NGI's Shale Daily.

The focal point of the proposal is the Pony Express Pipeline and making it the "pipeline of choice” for shippers in the DJ, Bakken Shale and Powder River Basin, said Pony Express General Manager Doug Johnson.

The proposed terminal is to serve as a new origin point for the Platteville extension of Pony Express, he said. Collaborating with Saddle Butte helped Tallgrass accelerate the Platteville extension by six months, he added.

TEP holds a 98% stake in Pony Express. Early this year, the Leawood, KS-based master limited partnership acquired TTL and Tallgrass NatGas Operator LLC.

TEP midstream affiliate Tallgrass Midstream LLC agreed last month to purchase the Douglas natural gas gathering system in Wyoming's Powder River Basin in a deal with DCP Midstream valued at $128 million.

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