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Terminal News

Tallgrass Energy & Silver Creek to develop pipeline system

Tallgrass Energy Partners and Silver Creek Midstream plan to develop a joint venture pipeline to transport crude oil from the Powder River Basin to Guerney, Wyoming.

The Iron Horse Pipeline will connect Silver Creek’s developing gathering system to the Tallgrass Guernsey Terminal, which is currently under construction, and then to Tallgrass’s Pony Express crude pipeline system, and other pipelines at Guernsey.

Iron Hose and Pony Express intend to create a joint tariff to offer producers and marketers a single rate and direct access to the multiple refineries on Pony Express and to the Cushing, Oklahoma crude oil hub.

Tallgrass has also agreed to sell its 50-mile PRB crude oil gathering system to Silver Creek. Tallgrass and Silver Creek expect to close the formation of the joint venture and the sale of Tallgrass Crude Gathering later in February.

As a result of the acquisition and the announced projects, Silver Creek will be positioned as the preeminent crude oil gathering company in the PRB.

J. Patrick Barley, found and CEO, says: ‘Silver Creek is extremely excited to work with Tallgrass in the PRB. Their current presence in the basin and long-haul crude transport capabilities bring a competitive advantage to Silver Creek as we work to fully build our gathering system.’

Tallgrass anticipates it will invest $150 million into this initiative.