Tallgrass Energy said late Tuesday it was beginning a binding open season for shippers seeking line space to move Midcontinent crude from Sterling, Colorado, to the oil hub of Cushing, Oklahoma.
Tallgrass said in the statement the company was "soliciting shipper commitments for crude oil transportation from Pony Express' Sterling origin to destinations in Cushing, Oklahoma, in exchange for volume incentive tariff rates."
The open season will run from December 10 to January 29, the statement said.
In September, Tallgrass initiated a broader open season for shippers on its Pony Express Pipeline as well as for shippers interested in sending Powder River Basin crude through its Iron Horse Pipeline onto Pony Express.
During its third-quarter earnings call, Tallgrass executives said October 30 it had signed contracts in excess 165,000 b/d for "varying paths with average rates plus or minus $2.50 and terms ranging from three to five years."
The company said at the time it was in "active and advanced" discussions for an additional 70,000 b/d of shipping capacity at similar tariff incentives.
The 420,000 b/d Pony Express Pipeline runs from Guernsey, Wyoming, through Colorado, Nebraska and Kansas, and carries crude from the Bakken, Denver-Julesburg Basin and Powder River Basin to three refineries before terminating at Cushing.
The 190,000 b/d Iron Horse will take Powder Basin crude to Guernsey. Linefill began in May. The Powder River Basin is in Wyoming on the border with Montana.
Pony Express throughput averaged 336,000 b/d in 2018 and 342,000 b/d in the first half of 2019, according to a recent company presentation.
The Powder River Gateway, which includes the Powder River Express and Iron Horse pipelines, has a total capacity of 190,000 b/d.
