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Epic Crude Pipeline asks FERC to move on its Permian takeaway project


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Epic Crude Pipeline asks FERC to move on its Permian takeaway project

Epic Crude Pipeline LP urged the Federal Energy Regulatory Commission to hurry on a request for approval of tariff and rate structure and other matters, saying any delay will hurt the schedule to build a crude oil pipeline connecting the busy Permian Basin production area to Texas terminals and the Port of Corpus Christi.

"The requested January 4, 2019, action date has now come and gone," wrote Phillip Mezey, CEO of the managing partner of Epic Crude Pipeline. "This is placing our project timeline in some jeopardy, and causing concern to our shippers."

A Jan. 11 research note from Tudor Pickering Holt & Co. called the lack of FERC action a "regulatory snag," but the energy investment bank said that because Epic has started construction on the pipeline, "interim service expected in Q3'19 does not appear to be impacted at this juncture" by a long delay.

Mezey made the request for expedited treatment in a Jan. 8 letter to FERC Chairman Neil Chatterjee and the three other commissioners. He asked for their help to get an approval order "by Jan. 15, 2019, if possible." He noted that Jan. 15 is a significant date in transportation service agreements, with five committed shippers. Noble Energy Inc. is one of the shippers on the Epic pipeline.

The company's announced plan was to have the greenfield pipeline up and running to Corpus Christi by the third quarter. Epic is part of Epic Midstream Holdings LP and, according to its website, partners with global asset manager Ares Management LP.

On Oct. 10, 2018, Epic asked FERC for a declaratory order approving a tariff and rate structure for the pipeline, terms of service, and open season procedure for a new pipeline system. The pipeline is designed to transport up to 590,000 barrels per day of Permian Basin oil production from Orla, Texas, to interconnections with terminals in Orla, other Texas cities and the Port of Corpus Christi, through which the oil can be exported. The company had asked FERC to issue the order no later than Jan. 4, but there were no more files in the docket in the FERC library after Mezey's Jan. 8 letter, as of midday Jan. 11. (FERC docket OR19-2)