SemGroup Corporation and Gavilon to Increase Ownership of Glass Mountain Pipeline
SemGroup Corporation (NYSE: SEMG), and Gavilon, LLC, today announced that each has completed the acquisition of a 25 percent share of Glass Mountain Pipeline LLC previously owned by an affiliate of Chesapeake Energy Corporation (NYSE: CHK). Following this purchase, SemGroup Corporation now owns 50 percent of Glass Mountain Pipeline; the remaining 50 percent of the pipeline is now owned by Gavilon. Chesapeake will maintain its long-term transportation agreement with Glass Mountain Pipeline, providing the economic incentive for its construction.
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The Glass Mountain Pipeline will have an initial capacity of approximately 140,000 barrels per day and 440,000 barrels of intermediate storage. The pipeline will consist of two laterals. One lateral will originate near the town of Alva in Woods County, Oklahoma. The second lateral will originate near the town of Arnett in Ellis County, Oklahoma. The pipeline will increase in diameter where the laterals intersect near Cleo Springs in Major County, Oklahoma and continue east to Cushing, Oklahoma. The pipeline will terminate at Gavilon's Cushing facility, where the joint venture will own one million barrels of crude oil storage. Following pipeline construction, Rose Rock Midstream, LP (NYSE: RRMS), SemGroup's master limited partnership, will serve as the pipeline operator.
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