Pipeline and storage operator Tallgrass Energy Partners, LP based in Leawood, Kansas announced this week that Oklahoma City-based Continental Resources, Inc. exercised its contractual right to extend its agreement with the company.
The agreement pertains to Continental’s shipment of crude with the Belle Fourche Pipeline Company and TEP’s subsidiary, Tallgrass Pony Express Pipeline, LLC. The contract is through Oct. 31, 2024 as the previous contract was scheduled to expire Oct. 31, 2019.
“We are pleased to extend our long-standing transportation relationship with Pony Express and Belle Fourche,” said Harold Hamm, Chairman and CEO of Continental Resources. “It provides a premier takeaway solution for our Bakken production when considering operational reliability, access to significant refining markets and, of course, access to storage and pipeline connectivity at Cushing. In addition, the extension will facilitate further improvements in the economics of our operations in the Bakken, the nation’s premier onshore oil play.”
David G. Dehaemers Jr., President and CEO of Tallgrass Energy said the agreement will help provide cash flow certainty for Pony Express.
“Pony Express is capable of transporting approximately 400,000 bbl/d and has just over 300,000 bbl/d currently contracted. This extension fills a portion of the pipeline’s available capacity from the Bakken and for a term of five years beyond the initial contract term, solidifying Pony Express’s long-term position in the crude oil transportation market.”
Of course the Bakken is a big producer for Hamm’s Oklahoma City company. Earlier this fall, Hamm announced a sale of 1 million barrels of oil from the Bakken to be transported eventually to China.