Tallgrass Energy Partners' Pony Express Pipeline Onstream
On Oct 8, oil and gas transportation and storage partnership, Tallgrass Energy Partners LP (TEP) declared the completion of the line fill activities of the Pony Express crude oil pipeline project and the start of its commercial services. The partnership has a 33.3% interest in the pipeline project, while the remaining 66.7% is owned by midstream energy player Tallgrass Development LP.
The crude oil pipeline of the Pony Express project covers roughly 690 miles. Tallgrass Energy Partners added that the pipeline starts from Guernsey, WY and ends at Cushing, OK. The delivery points of the pipeline are Ponca City Refinery and Deeprock in Cushing.
The Pony Express pipeline project will also include a lateral, expected to cover roughly 66 miles in Northeast Colorado. The lateral will originate from Weld County, CO from where it will connect with the Pony Express mainline in the east of Sterling, also in the same state.
Tallgrass Energy Partners also announced its third quarter 2014 cash distribution of 41 cents per common unit. The new distribution reflects year-over-year increase of 38% and a sequential hike of roughly 8%. The increased distribution will likely be paid on Nov 14, to the unitholders of record as of Oct 31.
The partnership added that it has hiked its quarterly distribution for five consecutive quarters since its initial public offering in May 2013. The recent distribution increase is in line with the partnership’s plan, to hike its third and fourth quarter distributions this year.
Overland Park, KS-based Tallgrass Energy Partners is primarily involved in the transportation, storage and processing activities by holding various midstream properties in North America. The partnership currently carries a Zacks Rank #1 (Strong Buy), implying that it will significantly outperform the broader U.S. equity market over the next one to three months.
Apart from Tallgrass Energy Partners, one can also consider players in the same industry like Transmontaigne Partners LP (TLP), Cheniere Energy Partners LP Holdings LLC (CQH) and Oiltanking Partners LP (OILT). Transmontaigne Partners also sports a Zacks Rank #1, while Cheniere Energy Partners and Oiltanking Partners hold a Zacks Rank #2 (Buy).
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