SemGroup to Diversify White Cliffs Pipeline Service with NGL Capabilities; Signs Long-Term Contract with DCP Midstream

TULSA, Okla., May 07, 2018 -- SemGroup^® Corporation (NYSE:SEMG) today announced that it plans to convert a portion of the White Cliffs Pipeline system to natural gas liquids (NGL) service. SemGroup owns 51 percent of White Cliffs Pipeline and is the operator. The project is backstopped by 10-year agreements with DCP Midstream, LP (NYSE: DCP) and its affiliate DCP Southern Hills Pipeline, LLC. The pipeline conversion will diversify White Cliffs Pipeline delivery capabilities and enhance service to Colorado’s prolific and growing DJ Basin.

“We are excited to execute this opportunity with DCP and provide a much-needed market solution to the DJ Basin, while at the same time optimizing White Cliffs to include both crude and NGL capabilities,” said David Minielly, Vice President of SemGroup’s crude operations. “This project provides producers and natural gas processors with a cost-effective and reliable solution to move valuable NGLs from Colorado to Mont Belvieu via Southern Hills Pipeline for processing and sale into the Gulf Coast marketplace.”

As operator, SemGroup will convert one of the 12-inch-diameter pipelines from crude service to NGL Y-grade service connecting the DJ Basin to Cushing, Okla. The pipeline will have an initial capacity of 90,000 barrels per day and will be expandable up to 120,000 barrels per day. It will be taken out of service late first quarter 2019 for conversion and is expected to be in service during the fourth quarter 2019. As part of the project, SemGroup will construct a 12-mile extension of White Cliffs Pipeline south of Cushing to interconnect with Southern Hills Pipeline in order to move NGLs south to Mont Belvieu.

The 10-year agreements provide DCP and Southern Hills with 50,000 barrels per day of NGL transportation capacity on the converted White Cliffs Pipeline.

The project is estimated to cost between $60 million and $66 million, of which SemGroup will fund 51 percent. Based on the currently executed contract, the project is estimated to be constructed at less than 4x EBITDA multiple. SemGroup anticipates minimal spending on this project in 2018.

White Cliffs Pipeline and Southern Hills Pipeline will soon conduct a joint binding open season to attract additional commitments from other producers and processors in the DJ Basin. Shippers will move product under a published joint tariff between the two carriers.

About SemGroup
SemGroup® Corporation (NYSE:SEMG) moves energy across North America through a network of pipelines, processing plants, refinery-connected storage facilities and deep-water marine terminals with import and export capabilities. SemGroup serves as a versatile connection between upstream oil and gas producers and downstream refiners and end users. Key areas of operation and growth include western Canada, the Mid-Continent and the Gulf Coast. SemGroup is committed to safe, environmentally sound operations. Headquartered in Tulsa, Okla., the company has additional offices in Calgary, Alberta; Platteville, Colo.; and Channelview, Texas.

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Forward-Looking Statements
Certain matters contained in this Press Release include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995.

All statements, other than statements of historical fact, included in this Press Release may constitute forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that these expectations will prove to be correct. These forward-looking statements are subject to certain known and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements. Factors that might cause actual results to differ include the risk factors discussed from time to time in each of our documents and reports filed with the SEC.

Readers are cautioned not to place undue reliance on any forward-looking statements contained in this Press Release, which reflect management’s opinions only as of the date hereof. Except as required by law, we undertake no obligation to revise or publicly release the results of any revision to any forward-looking statements.

SemGroup Investor Relations:
Alisa Perkins
918-524-8081
[email protected]

SemGroup Media:
Tom Droege
918-524-8560
[email protected]