ONEOK, Martin Midstream partner on $200M Delaware Basin pipeline

By Luke Geiver | October 24, 2017

Eyeing the growth potential for natural gas liquids produced from the Delaware Basin, ONEOK Inc., has announced a new joint-venture effort with Martin Midstream. The midstream service providers will work together to build a 120-mile, 16-inch pipeline lateral with a capacity of 110,000 barrels per day into West Texas and the heart of the Delaware Basin.

Terry Spencer, president and CEO of ONEOK, said the pipeline will put both companies into one of the fastest growing plays in the U.S. and position each “for significant future NGL volume growth.”

Ruben Martin III, president and CEO of Martin, also said the move will help the company access future growth opportunities for NGLs in the Delaware Basin.

Through the joint venture, ONEOK will own and operate 80 percent of the pipeline with Martin holding the remaining 20 percent. The buildout should be complete by the end of Q3 2018, according to the company. In addition to the pipeline, two third-party natural gas processing plants in northern Reeves County will be utilized. Long-term volume dedications of 40,000 bpd are already in place, according the Martin. The pipeline will eventually connect more than 40 third-party natural gas processing plants located in the Permian Basin with the Mont Belvieu market center.

The pipeline expansion process will cost roughly $200 million.