July 23, 2018 - 5:15 PM EDT
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Crestwood Provides Strategic Delaware Basin Update

HOUSTON

200 MMcf/d Orla cryogenic gas processing plant placed into service

Acquired ownership in EPIC NGL Pipeline’s Orla-to-Benedum segment securing NGL pipeline capacity to the Gulf Coast

Entered into long-term Y-grade purchase agreement with Chevron Phillips Chemical Company

Crestwood Equity Partners LP (NYSE: CEQP) (“Crestwood” or “CEQP”) announced that Crestwood Permian Basin Holdings LLC (“CPJV”) completed construction and began processing volumes at the Orla plant, a new 200 MMcf/d cryogenic gas processing plant located in Reeves County, TX. Concurrently, CPJV brought into service the Orla Express Pipeline, a 33 mile, 20-inch-high pressure line connecting the existing Willow Lake system with the Orla plant. CPJV expects the Nautilus-to-Orla Pipeline, a 28 mile, 20 inch high pressure line connecting the Nautilus system to the Orla plant, to be fully in-service in the coming days. The Orla plant and associated infrastructure was placed into service on schedule, on budget, and without any major recordable safety incidents.

Crestwood Permian Basin Holdings LLC is a 50/50 joint venture between Crestwood and First Reserve, a leading global private equity investment firm exclusively focused on energy. CPJV’s Delaware Basin gathering and processing assets are supported by long-term contracts with premier customers and now include 255 MMcf/d of processing capacity, 650 MMcf/d of natural gas gathering capacity and 390 miles of integrated pipelines spanning the northern & southern Delaware Basin.

EPIC NGL Pipeline Transaction

CPJV entered into an agreement with EPIC Y-Grade Pipeline, LP (“EPIC”) to acquire undivided joint ownership in the Orla-to-Benedum segment of EPIC’s 16” NGL pipeline, which was placed into service June 2018. The ownership interest provides CPJV control of 80,000 Bbls/d of capacity out of the Delaware Basin to multiple downstream connections in the Benedum, TX area with ultimate access to Sweeny, Mont Belvieu, and Corpus Christi markets. CPJV’s 80,000 Bbls/d of capacity, which is sufficient to move NGL product from the new 200 MMcf/d Orla plant plus two additional 250 MMcf/d processing train expansions, is being marketed on a standalone basis as a CPJV proprietary pipeline. CPJV’s ownership in this pipeline provides a competitive NGL takeaway solution to continue growing its G&P footprint in the Delaware Basin.

Chevron Phillips Y-Grade Sales Agreement

Simultaneously, CPJV entered into a long-term purchase and sale agreement with Chevron Phillips Chemical Company LP (“Chevron Phillips”) in which CPJV will sell, and Chevron Phillips will purchase, Y-grade originating from CPJV’s Orla plant in Reeves County, TX. Crestwood will deliver Y-grade product produced at the Orla plant via the Orla-to-Benedum segment to Chevron Phillips at the EZ Pipeline at Benedum Station, through which the product has the ability to reach multiple outlets to Mont Belvieu and be a key feedstock supplier to Chevron Phillips’s Sweeny Complex located along the Gulf Coast.

Heath Deneke, Executive Vice President and Chief Operating Officer, commented, “Today marks a key moment for Crestwood’s Delaware Basin growth strategy as we have placed into service the first Orla plant, integrated the Willow Lake and Nautilus gathering systems, secured NGL pipeline takeaway capacity for the new Orla plant and future plant expansions, and signed a long-term, attractive marketing agreement for a substantial portion of Orla’s current and future NGL products. Crestwood now operates a fully integrated gathering and processing system in the core of the Delaware Basin that is scaled to meet our producer’s current and future expected volume growth. Additionally, going forward, Crestwood is positioned to securely and economically move Orla NGL products into Gulf Coast markets which provides our customers optionality and flow assurance that creates a unique competitive advantage for Crestwood.”

About Crestwood Permian Basin Holdings LLC

Crestwood Permian Basin Holdings LLC (“CPJV”) is a 50/50 joint venture between Crestwood Equity Partners LP and First Reserve focused on developing, owning and operating midstream infrastructure in the Delaware Basin.

About First Reserve

First Reserve is a leading global private equity investment firm exclusively focused on energy. With 35 years of industry insight, investment expertise and operational excellence, the Firm has cultivated an enduring network of global relationships and raised approximately USD $31 billion of aggregate capital since inception. First Reserve has completed over 650 transactions (including platform investments and add-on acquisitions), creating several notable energy companies throughout the Firm’s history. Its portfolio companies have operated on six continents, spanning the energy spectrum from upstream oil and gas to midstream and downstream, including resources, equipment and services, and associated infrastructure. Visit us at www.firstreserve.com for more information.

About Crestwood Equity Partners LP

Houston, Texas, based Crestwood Equity Partners LP (NYSE: CEQP) is a master limited partnership that owns and operates midstream businesses in multiple unconventional shale resource plays across the United States. Crestwood is engaged in the gathering, processing, treating, compression, storage and transportation of natural gas; storage, transportation, terminalling, and marketing of NGLs; and gathering, storage, terminalling and marketing of crude oil.

Forward Looking Statements

This press release may include certain statements concerning expectations for the future that are forward-looking statements as defined by federal securities law. Such forward-looking statements are subject to a variety of known and unknown risks, uncertainties, and other factors that are difficult to predict and many of which are beyond management’s control. These risks and assumptions are described in Crestwood’s annual reports on Form 10-K and other reports that are available from the United States Securities and Exchange Commission. Readers are cautioned not to place undue reliance on forward-looking statements, which reflect management’s view only as of the date made. We undertake no obligation to update any forward-looking statement, except as otherwise required by law.

Crestwood Equity Partners LP
Investor Contacts
Josh Wannarka, 713-380-3081
Vice President, Investor Relations
[email protected]
or
Elizabeth Suman, 832-519-2276
Senior Manager, Investor Relations & Corporate Communications
[email protected]
or
First Reserve
Media Contact
Joele Frank, Wilkinson Brimmer Katcher
Jonathan Keehner / Julie Oakes, 212-355-4449
[email protected]


Source: Business Wire (July 23, 2018 - 5:15 PM EDT)

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