Midland’s Diamondback Energy, in partnership with Kinetik Holdings, said Tuesday it is boosting its takeaway capacity and ownership stake in EPIC crude pipeline. Diamondback and Kinetik acquired a 30 percent equity interest in EPIC Crude Holdings; each now owns 27.5 percent of EPIC Crude. EPIC Midstream continues to own the other 45 percent equity interest in and manages the operations of EPIC Crude.
Diamondback is converting its existing commitment for EPIC into a larger volume commitment of 200,000 barrels per day to accommodate additional crude from its merger with Endeavor Energy Resources. Diamondback will become the third largest crude producer in the Permian Basin.
Kinetik, with offices in Midland and Houston, now has a new transportation arrangement with EPIC and a new connection between its crude gathering system and EPIC pipeline. The combined commitments represent 33 percent of EPIC pipeline volume capacity.
Kaes Van’t Hof, president and CFO of Diamondback, said, “This series of transactions signifies a major step in ensuring reliable, cost-effective takeaway out of the basin for our expanded crude portfolio for a significant period of time and positions EPIC Crude to be our preferred crude pipeline given our increased ownership stake and expanded governance role in the joint venture.” Brian Freed, CEO of EPIC Midstream, added, “The strategic importance of this asset is supported by our partners’ long-term commitments. EPIC Crude continues to be a critical asset for Permian Basin crude oil production egress to the Corpus Christi market.”
EPIC’s crude oil pipeline and NGL pipeline each span about 700 miles from Permian and Eagle Ford to Corpus Christi.