May 10 (Reuters) - EPIC Midstream Holdings LP said on Thursday it formed strategic partnerships with Apache Corp and Noble Energy for its Texas pipeline, which is expected to be in service in the second half of 2019.
The EPIC Crude Oil Pipeline will run beside the company’s Natural Gas Liquids Pipelines for 730 miles from southeastern New Mexico to Corpus Christi, Texas, the company said in a statement.
U.S. oil production has reached an all-time high, but the prolific output is causing bottlenecks as pipelines transporting the crude have filled up more quickly than expected. That has depressed prices in the Permian, posing a threat to future production, while providing a boost to pipeline companies as the lines have filled to near capacity.
Apache and Noble Energy would anchor the crude oil pipeline, which will have an initial total capacity of 590,000 barrels of oil per day, including 440,000 barrels per day from the Permian Basin and 150,000 barrels per day from the Eagle Ford.
As part of the partnerships, Apache will have an option to buy up to 15 percent of the equity in the EPIC Crude Oil Pipeline, and Noble will have an option to acquire up to 30 percent of equity in the EPIC Crude Oil Pipeline, as well as up to 15 percent of the EPIC NGL Pipeline, the company said.
The EPIC pipelines are backed by capital commitments from funds managed by the Private Equity Group of Ares Management LP . (Reporting by Vibhuti Sharma and Ismail Shakil in Bengaluru Editing by Leslie Adler)