April 15, 2019
MIDLAND, Texas -- Concho Resources Inc. (NYSE: CXO) ("Concho") and Frontier Midstream Solutions IV, LLC ("Frontier") announced today that Concho and Frontier have executed an agreement to create Beta Crude Connector, LLC ("BCC"). Concho and Frontier will each own a 50% equity interest in BCC, with Frontier serving as operator. BCC will build and provide crude oil gathering, transportation and storage services in the Northern Midland Basin, supporting continued oil production growth in the region.
The new gathering and transportation system will consist of an approximately 100-mile gathering system, 250,000 barrels of crude oil storage facilities as well as truck terminals. The pipeline system will have the initial capacity to deliver 150,000 barrels per day of crude oil to multiple delivery points, accessing local refineries and connecting to several downstream pipelines. Following an open season set for April 2019, construction will commence, targeting initial flows in mid-2019.
BCC will file for FERC authority to operate as a common carrier pipeline and solicit interest from other producers and marketers for capacity on the new system. In conjunction with the joint venture agreement, Concho has agreed to enter into a long-term acreage dedication agreement with BCC.
Jack Harper, President of Concho, commented, "We are excited to partner again with Frontier in the development of the Beta Crude Connector. Through the joint venture, we will leverage Frontier's midstream expertise and enhance the value of our high-quality footprint in the Midland Basin with a reliable, cost-efficient gathering and transportation solution. Importantly, this is a compelling investment opportunity that we can make with our capital outlook fully intact and no changes to our operating plan."
Dave Presley, Frontier's Chief Executive Officer said, "We are pleased that Beta Crude Connector will be the latest of our full-service midstream solutions and our second joint venture partnership with Concho as we demonstrate our commitment to quality partnerships and solutions for producers once again. We are pleased to have a world class producer in Concho as our partner and are excited with the quality of the resource behind it. We are dedicated to the successful operations and growth of the Beta Crude Connector."
Concho Resources (NYSE: CXO) is one of the largest unconventional shale producers in the Permian Basin, with operations focused on acquiring, exploring, developing and producing oil and natural gas resources. Concho is at the forefront of applying advanced technology and large-scale development to safely and efficiently maximize resource recovery while delivering attractive, long-term economic returns. We are working today to deliver a better tomorrow for our shareholders, people and communities. For more information about Concho, please visit www.concho.com.
Frontier Midstream Solutions IV, LLC, headquartered in Tulsa, Oklahoma, is owned by Frontier Energy Partners II, LLC and certain funds of Energy Spectrum Capital. The company is a fullservice midstream company focused on the development of new midstream crude oil and natural gas infrastructure in the Permian Basin and other basins throughout the lower 48 states.
Founded in 1995, Energy Spectrum Capital ("Energy Spectrum") is a Dallas, Texas-based private equity firm focused on partnering with premier management teams that are pursuing compelling opportunities in the midstream sector of the North American oil and gas industry. To date, Energy Spectrum has successfully raised approximately $4.4 billion of equity capital across eight funds. Frontier Midstream Solutions IV LLC is supported with capital from Energy Spectrum Partners VII LP and Energy Spectrum Partners VIII LP, the firm's most recent fund. For more information, please visit www.energyspectrum.com.