Published: November 6, 2018 |

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Noble Midstream Partners LP has released a commercial and business development update for its operations in the Permian Basin in Texas.

HIGHLIGHTS INCLUDE:

• Noble Midstream has entered into a letter of intent with Salt Creek Midstream to form a 50/50 joint venture on a crude oil pipeline and gathering system in the Delaware Basin
 
• The joint venture will be underpinned by acreage contributions from Noble Midstream and Salt Creek of approximately 180,000 dedicated acres from Noble Energy Inc. and five other Southern Delaware Basin producers, with a line of sight to additional dedications totaling approximately 100,000 acres
 
• Reached long-term agreement for the Advantage Pipeline system to service a major producing company’s facilities on such customer’s Southern Delaware position totaling approximately 20,000 net acres. First flow is expected to commence in October 2018
 
• Noble Midstream connected its first Delaware Basin well for a third-party producer during September

“Since our IPO, we have continued to expand our Permian service offerings beyond infield gathering and have materially enhanced our third-party platform. These opportunities build on our strategy and provide Noble Midstream additional pathways to our stated goal of 50 percent net EBITDA contribution from the Permian by the end of 2020,” said Terry R. Gerhart, chief executive officer of Noble Midstream.

DELAWARE BASIN PIPELINE OPPORTUNITY WITH SALT CREEK MIDSTREAM

Noble Midstream signed a letter of intent with Salt Creek to partner on the construction of a 200 thousand barrel of oil per day newbuild pipeline system in the Delaware Basin. The 95-mile, 20-inch diameter pipeline system will originate in Pecos County, Texas, with additional connections in Reeves County and Wink County, Texas. The project footprint will be served by a combination of in-field crude gathering lines and a trunkline to Wink Hub. The partnership anticipates the execution of definitive agreements and closing of the transaction to occur in the fourth quarter of 2018.

At closing, the project would be underpinned by approximately 180,000 dedicated acres and nearly 100 miles of pipeline in Pecos, Reeves, Ward and Winkler Counties. This includes an in-basin oil transportation dedication of the southern portion of Noble Energy’s Reeves County position totaling approximately 70,000 acres. Noble Midstream will continue to provide oil gathering services for Noble Energy’s Permian development in the Blanco River DevCo and the northern Reeves County acreage position remains dedicated to the Advantage Pipeline system for in-basin oil transportation through the Trinity River DevCo.

“We are excited to partner with Salt Creek on the formation of this joint venture and look forward to bringing both our commercial and operations expertise to the table. The pipeline system will provide critical downstream connectivity and enhanced market optionality for producers in the Southern Delaware Basin,” said Terry R. Gerhart, chief executive officer of Noble Midstream.

“We are excited to be working in partnership with the Noble Midstream team in the Southern Reeves area. We have known and respected the Noble Midstream team for some time and look forward to building a world class crude oil business with them as a partner in the Delaware Basin,” said Salt Creek CEO Zach Lee.

Salt Creek has commenced construction of the pipeline, with an expected operational date in the second quarter of 2019. The project provides access to 200,000 barrels of new crude oil storage, with expansion potential to 300,000 barrels. The five-year net capital investment for Noble Midstream is anticipated to total approximately $60 to $80 million. The investment is supported by an average customer acreage dedication term of approximately 15 years.

THIRD-PARTY PERMIAN GATHERING IN BLANCO RIVER

Noble Midstream commenced gathering on an initial well for a third-party Delaware Basin producer in September. The customer development plan spans across approximately 13,000 dedicated acres in Reeves County, with additional activity on the acreage anticipated in 2019. Oil, gas, and produced water gathering services are being provided through the Blanco River development company.

About Noble Midstream
Noble Midstream is a growth-oriented master limited partnership formed by Noble Energy, to own, operate, develop and acquire domestic midstream infrastructure assets. Noble Midstream currently provides crude oil, natural gas, and water-related midstream services in the DJ Basin in Colorado and the Delaware Basin in Texas.

To stop by Noble Midstream’s website, CLICK HERE

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