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Velocity Midstream constructs crude oil pipeline loop through SCOOP Play in US

EBR Staff Writer Published 07 March 2018

Velocity Midstream Partners has completed the construction of a crude oil pipeline loop of its existing condensate pipeline through the fairway of the South Central Oklahoma Oil Province (SCOOP) in the US.

The 45-mile 12" crude oil loop project is backed by expanded commitments from Continental Resources and CVR Refining.

The firm also commenced construction of a 22-mile, 12" crude oil pipeline extension which links the core of the Merge play to the firm’s SCOOP pipeline assets. The project is scheduled to be commissioned in April 2018.

Additionally, Velocity has completed a Joint Tariff agreement with Plains All American Pipeline providing storage and segregated, batched crude transportation to PAA's Cushing terminal.

Velocity said it has also acquired all of the truck unloading terminals along its pipelines as well as added terminals to provide attractive locations for SCOOP and Merge producers.

Upon completion of Merge terminal, Velocity will have six unloading terminals operating across the SCOOP and Merge plays.

The firm is also considering constructing an additional 15-mile pipeline extension and a new terminal in central Canadian County.

Velocity said in statement: “The new crude oil pipeline enables producers in the SCOOP and Merge to segregate their heavier crude barrels produced from the Springer, Sycamore, Meramec and Woodford oil formations from the lighter barrels being produced from the Woodford condensate formation.”

Velocity expects the segregated pipelines to enable transportation of different quality "neat barrels" from the wellhead to premium markets.

Velocity CEO Rick Wilkerson said: "The attractiveness of Woodford, Springer, Meramec and Sycamore crude to Midcontinent refiners like CVR, coupled with the reduction in crude gathering and transportation costs, provides the producers in the SCOOP and Merge with the Midcontinent's preeminent market options."

Currently, Velocity's system consists of 125 miles of pipeline capable of flowing 250,000 barrels per day, along with 395,000 barrels of storage and 26 truck unloading bays capable of unloading greater than 100,000 barrels per day.