Transporting crude oil from the lease to refineries and export docks is like a long-distance relay race. The crude oil gathered from several wells is handed off to shuttle or takeaway pipelines, which then pass it on to regional crude hubs like Cushing, OK — from the hubs, crude is transferred to still other pipes. To get the relay going, the developers of crude gathering systems work closely with their takeaway pipeline counterparts to figure out the most efficient way to effect the first baton pass. Today, we continue our series on crude-related infrastructure in the Rockies’ Denver-Julesburg (D-J) Basin with a look at Outrigger Energy’s existing and planned gathering systems, and their connections to Tallgrass Energy’s still-expanding Pony Express takeaway pipeline.
D-J Basin crude oil production increased by about 100 Mb/d, or 20%, between January 2019 and January 2020, according to our friends at IHS Markit, and now consistently tops 600 Mb/d, making it one of the fastest-growing production areas in the U.S. As we said in Part 1 of our series on the play’s crude gathering systems, the D-J in northeastern Colorado and southeastern Wyoming offers an unusually intense concentration of hydrocarbons within four geologic layers, or “benches,” only a few thousand feet below the surface, as well as low per-well drilling costs and direct pipeline access to the crude oil hub in Cushing. We also noted that the vast majority of the basin’s production growth has been occurring in Weld County, CO. Lastly, we discussed the Black Diamond crude gathering system in Weld County that is co-owned by Noble Midstream Partners and Greenfield Midstream. Part 2 reviewed Noble Midstream’s nearby Wells Ranch, East Pony, Greeley Crescent and Mustang systems, and Part 3 considered the crude transportation network now being expanded by Taproot Energy Partners. In Part 4, we discussed the gathering systems, trunk lines and crude storage owned by ARB Midstream, and last time, in Part 5, we looked at Western Midstream Partners’ system.
To truly understand Cushing — what it does and how it works — you need to know the hub’s assets and how they fit together. RBN’s Cushing Crude Oil Playbook provides the first one-stop, comprehensive guide to the hub’s assets.
Today, we turn our focus to existing and planned D-J gathering systems that are owned by Outrigger Energy — or, more specifically, Outrigger Energy II LLC — and by Extraction Oil & Gas’s subsidiary Elevation Midstream. We’ll start with Outrigger Energy. The second iteration of the privately held company was formed in early 2018 after the original Outrigger Energy LLC sold two midstream systems in the Permian Basin to Targa Resources and sold a 34-mile crude gathering system in the Powder River Basin in Wyoming to Tallgrass Energy. Both of those deals closed in 2017. The “new” Outrigger has targeted two other plays: the Williston Basin in North Dakota and the D-J Basin. In the D-J, Outrigger Energy II owns gas gathering systems, a 60-MMcf/d gas processing plant, and systems for gathering the produced water that emerges from wells with crude oil and associated gas, as well as the two crude gathering systems we’ll look at now.
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About the song
"40 Miles From Denver" was written by Ben Kaufmann, and appears as the eighth cut on Yonder Mountain String Band's debut album, Elevation. The album was released in September 1999 on Frog Pad Records, an independent record label run by the band. Production chores were handled by Sally Van Meter. Personnel on the record were: Dave Johnston (banjo, vocals), Jeff Austin (mandolin, vocals), Ben Kaufmann (bass, vocals) and Adam Aijala (guitar, vocals). The song features producer Sally Van Meter on resophonic guitar. An interesting side note to this song is that Nederland, CO, where Yonder Mountain String Band resides, is about 40 miles from Denver — just like the D-J.
Elevation was recorded at Rancho DeVille, Sawtelle Studio and Swallow Hill in Denver. Additional musicians on the album were: Darol Anger (fiddle), Celeste Krenz (backing vocals), Mike Marshall (mandolin) and Sally Van Meter (electric lap steel, resophonic guitar).
Yonder Mountain String Band is an American progressive bluegrass/jam band formed in Nederland, CO, in 1998. The band was started by Dave Johnston and Jeff Austin, who had previously played together in The Bluegrassholes in Urbana, IL. After relocating to Colorado, the two put together what would become Yonder Mountain String Band. They developed a loyal following by constantly touring on the bluegrass and jam band circuits. Austin left the band in 2014, and passed away earlier this year. The current lineup features original members Johnston, Kaufmann and Aijala, joined by Allie Kral (fiddle, vocals) and Jake Joliff (mandolin, vocals). Yonder Mountain String Band has released five studio albums and five live albums. They continue to record and tour.
