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Tallgrass Energy and Kinder Morgan Announce Exclusive Agreement for Rockies Crude Oil Transportation Service to Downstream Markets

Tallgrass Energy, LP, January 23, 2019

Tallgrass Energy, LP and Kinder Morgan, Inc. recently announced an agreement to jointly develop a solution to increase existing crude oil takeaway capacity in the growing Powder River and Denver-Julesburg basins and to add incremental capacity to the Williston Basin and portions of Western Canada.

Pursuant to the agreement, the proposed venture would include both existing and newly constructed assets. TGE would contribute its Pony Express Pipeline System, and KMI would contribute portions of its Wyoming Intrastate Company and Cheyenne Plains Gas Pipeline and begin the process of abandonment and conversion to crude oil service. In addition, approximately 200 miles of new pipeline would be constructed to provide crude oil deliveries into Cushing, Okla.

In total, the combined pipeline system is expected to be capable of delivering up to 800,000 barrels per day (bpd) of light crude oil and 150,000 bpd of heavy crude oil from points in Wyoming and Colorado to TGE’s and KMI’s Deeprock terminal in Cushing. From there, customers will have pipeline connectivity to the Gulf Coast and export markets through TGE’s planned Seahorse Pipeline and other existing or proposed future pipeline projects. The combined project is expected to provide initial service as early as the second half of 2020.

This combination of assets creates a significant growth opportunity for both companies,” said Tallgrass Chief Operating Officer Bill Moler. “Shippers benefit by gaining access to a pipeline system that can source from multiple basins and access numerous demand markets including existing refinery connections on Pony Express and Tallgrass’ downstream options. Other shipper benefits include a quicker in-service date and the ability to batch a greater variety of common streams.

There are a number of competitive advantages to jointly developing this project and leveraging KMI’s and TGE’s existing assets, including the expansion of our Double H Pipeline system,” said Don Lindley, Chief Commercial Officer for Products Pipelines at KMI. “Chief among them is the ability to quickly and efficiently place an additional 550,000 barrels per day of crude transportation takeaway capacity in service from the Rockies, which helps domestic producers and offers near-term relief for Canadian producers.”

Completion of the transaction between TGE and KMI remains subject to conditions, including receipt of applicable state and federal regulatory approvals, among other items.

Extension of Pony Express Open Seasons

In conjunction with the execution of the agreement, TGE extended its current Pony Express expansion and joint tariff open season with Seahorse to Feb. 28, 2019. For further information regarding the project, please contact Kyle Quackenbush (303-763-3319) or Andrew DiPaolo (303-763-3329) with TGE and Dwaine Shroyer (918-588-5074) with KMI.

About Tallgrass Energy

Tallgrass Energy, LP (NYSE: TGE) is a growth-oriented midstream energy infrastructure company operating across 11 states with transportation, storage, terminal, water, gathering and processing assets that serve some of the nation’s most prolific crude oil and natural gas basins. To learn more, please visit our website at www.tallgrassenergy.com.

About Kinder Morgan

Kinder Morgan, Inc. (NYSE: KMI) is one of the largest energy infrastructure companies in North America. We own an interest in or operate approximately 84,000 miles of pipelines and 157 terminals. Our pipelines transport natural gas, refined petroleum products, crude oil, condensate, CO2 and other products, and our terminals transload and store liquid commodities including petroleum products, ethanol and chemicals, and bulk products, including petroleum coke, metals and ores. For more information please visit www.kindermorgan.com.


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