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Velocity Midstream wraps up 1 oil line build-out in Oklahoma, starts another

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Velocity Midstream wraps up 1 oil line build-out in Oklahoma, starts another

Velocity Midstream Partners LLC on March 6 said it finished building a crude oil pipeline loop through Oklahoma's SCOOP play and has began work on a separate crude oil pipeline extension that would link additional production in the area to the company's SCOOP pipeline assets.

Velocity Midstream said it also completed a joint tariff agreement with Plains All American Pipeline LP for storage and segregated crude transportation to Plains' terminal in Cushing, Okla.

The 45-mile, 12-inch pipeline loop of Velocity Midstream's condensate pipeline is underpinned by commitments from the Oklahoma City-based producer Continental Resources Inc. and the Texas-based petroleum refiner CVR Refining LP. The new pipeline extension, a 22-mile, 12-inch diameter line connected to the Merge play, is scheduled to begin operations in April. The company is also in talks with producers for the build-out of another 15-mile pipeline extension and a terminal in central Canadian County, Okla.

The pipelines would allow regional producers to segregate heavier crude barrels coming from the Springer, Sycamore, Meramec and Woodford oil formations, from lighter barrels coming from the Woodford condensate formation, according to a March 6 news release.

Velocity's system now includes 125 miles of pipeline with 250,000 barrels per day of transportation capacity, as well as 395,000 bbl of storage and 26 truck unloading bays with unloading capacity of over 100,000 bbl/d.