Noble Midstream Partners has acquired equity interest in the EPIC Y-grade pipeline and the CPIC crude oil pipeline.
It has exercised and closed its option with EPIC Midstream Holdings to acquire 15% in the Y-grade pipeline. Additionally, Noble Energy has assigned Noble Midstream the option to acquire a 30% equity interest in the EPIC crude oil pipeline and Noble Midstream has exercised its option with EPIC.
Both pipelines are anticipated to be funded through project level debt as well as equity commitments from project partners. Noble Midstream’s total cash equity investment is expected to be $165 to $180 million for the EPIC Y-grade pipeline and $330 to $350 million for the EPIC crude oil pipeline.
The company says that the additional of meaningful Permian long-haul transportation to the portfolio provides a future source of stable and predictable cash flows for unitholders and that both investments are expected to have robust economics, with returns and build multiples that compete with the very best opportunity’s in its portfolio.
The EPIC Y-grade pipeline is a 700-mile pipeline linking NGL reserves in the Permian and Eagle Ford to Gulf Coast refiners, petrochemical companies and export markets. The EPIC crude oil pipeline has a current capacity of 590 million barrels per day from the Delaware Basin to the Gulf Coast.
Terry Gerhart, CEO of the general partner of Noble Midstream, says: ‘We are excited to work with our new partners and participate in the EPIC projects, capitalising on the growing demand for crude oil and NGL takeaway and export capability from the Permian Basin.
‘These additions are complementary to our existing portfolio, enhance our customer diversification, and will add a stable and high-quality source of cash flow from a premier US unconventional basin. In addition, Noble Midstream is uniquely positioned to realise value across the entirety of the crude oil value chain, from our wellhead gathering facilities in the Delaware Basin to long-haul transportation to the Gulf Coast.