SemGroup Corporation (together with its affiliates, “SemGroup”) and DCP Midstream, L.P. (together with its affiliates, “DCP”) (jointly referred to as “Sponsors”) are pleased to announce the commencement of an open season process to solicit binding commitments for transportation service to support the development of a new pipeline system to transport segregated, neat light batches of crude oil originating in Cushing, Oklahoma with a Houston, Texas destination (the “Gladiator Pipeline”) and access to the growing Gulf Coast market, including the Houston Ship Channel.
The proposed Gladiator Pipeline would create new crude oil capacity to the market through the conversion of the existing Southern Hills Pipeline to crude oil service with an origin of SemGroup’s terminal in Cushing and a destination of SemGroup’s Moore Road junction in Houston. The Cushing oil hub will provide numerous options for potential shippers to source barrels including from the production field in the Denver-Julesberg Basin, and other basins that deliver crude oil to Cushing, to the Houston Gulf Coast. The proposed Gladiator Pipeline will also provide potential shippers with operational storage in Cushing and Houston. Proprietary storage may also be separately contracted for by potential shippers at SemGroup’s Cushing terminal and SemGroup’s HFOTCO terminal.
The Gladiator Pipeline would be developed through a potential entity that would be jointly-owned by the Sponsors (the potential newly-formed entity to be, “Gladiator Pipeline, LLC” or “Gladiator”). The capacity on the proposed Gladiator Pipeline is expected to be approximately 300,000 barrels per day. If sufficient commitments are obtained, subject to the receipt of all of the necessary approvals, permits and force majeure, the proposed Gladiator Pipeline anticipates being operational by third quarter of 2020.