Market Overview

Pinnacle Midstream Announces New Growth Projects in Northern Delaware Basin

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  • Completes a 60 million cubic feet per day gas processing plant,
    additional crude oil gathering pipelines, enhanced crude and gas
    market interconnects and expanded crude oil transload and storage
    terminal
  • Begins construction of a new crude oil stabilization facility to
    support its ongoing crude oil business in the Delaware Basin
  • Projects anchored by long-term acreage dedications and
    reservations fees with top Permian Basin producers and Marketers

Pinnacle Midstream announced today the completion of multiple crude oil,
gas gathering and processing projects in the northern Delaware Basin,
one of the most active oil and gas producing basins in the United
States. Pinnacle began operations of a new 60 million cubic feet per day
natural gas processing plant (Sierra Grande I), several new compressor
stations and additional low- and high-pressure gas gathering pipelines.
The project also included constructing additional crude oil gathering
pipelines, expanding a crude oil transload and storage terminal with a
combined capacity of 30,000 barrels, and new connections to multiple
downstream crude oil and natural gas pipelines in Culberson and Reeves
Counties, Texas.

"We are very happy with the high-quality assets our team constructed
over the past 12 months," said J. Greg Sargent, Founder and Chief
Executive Officer at Pinnacle. "Our investment continues Pinnacle's
first-mover approach in Culberson and Reeves Counties and will help meet
the midstream needs of our current and future customers. We are excited
for the near- and long-term opportunities that our footprint enables us
to capture."

Pinnacle also began construction of a crude oil stabilization facility
capable of stabilizing up to 5,000 barrels per day, which could be
expanded as needed to meet customer demand. The Sierra Grande Crude
Stabilization Facility is scheduled to begin operations in fourth
quarter of 2018 and will accept both trucked and pipeline delivered high
RVP barrels that need stabilization to meet downstream pipeline
requirements.

"With the increasing volatility of crude in and around Culberson and
Reeves Counties we feel it is imperative to construct this
strategically-located facility to continue offering first-in-class flow
assurances for our customers, we look forward to continuing to grow our
multiple midstream services franchise throughout the region," said Drew
Ward, Chief Commercial Officer at Pinnacle.

Pinnacles' midstream infrastructure is anchored by long-term acreage
dedications with top-tier Permian operators. The company's gathering
systems are designed to support multi-well pad development, which is
anticipated to accelerate through the rest of the year and into 2019.
Pinnacle anticipates further expansions of its gathering systems and
processing capacity, which could include multiple additional natural gas
processing plants, as early as the second quarter of 2019.

About Pinnacle Midstream

Pinnacle Midstream, LLC is an independent midstream energy company
headquartered in Houston, Texas. The company is focused on crude oil
gathering, natural gas gathering and processing, compression, treating,
water and condensate handling and stabilization. Pinnacle currently owns
and operates approximately 100 miles of natural gas and crude oil
pipeline, a natural gas processing complex and 30,000 barrels of crude
oil transloading and storage capacity in the Delaware Basin. Pinnacle is
a portfolio company of I Squared Capital.

About I Squared Capital

I Squared Capital is an independent global infrastructure investment
manager focusing on energy, utilities, telecommunications and transport
in the Americas, Europe and Asia. The firm has offices in Hong Kong,
Houston, London, Miami, New Delhi, New York and Singapore.

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