Energy Transfer
DELAWARE BASIN CRUDE GATHERING PIPELINE

ETP CRUDE LLC

NOTICE OF OPEN SEASON

On August 5th, 2015, Energy Transfer Partners, L.P. (NYSE: ETP) issued a press release announcing that its affiliate, ETP Crude LLC ("ETP Crude"), will commence an Open Season for a new pipeline, Delaware Basin Crude Gathering Pipeline, that will have the capacity to accept up to approximately 120,000 barrels per day of crude oil from receipt points located in Reeves County, Texas and Lea County, New Mexico for transportation to delivery points in Loving County, Texas and Lea County, New Mexico ("Pipeline"). Service on the Pipeline will be subject to one or more tariffs to be filed by ETP Crude with the Federal Energy Regulatory Commission.

The project, when completed, will consist of three separate gathering systems with an aggregate of approximately 130 miles of pipeline. The gathering systems will deliver crude oil into Sunoco Pipeline L.P.'s (Sunoco) Delaware Basin Extension.

Open Season

ETP Crude is holding this 30 day Open Season to provide potential shippers with the opportunity to support the Pipeline by making long-term acreage dedication commitments thereby becoming "Committed Shippers" entitled to firm service for the term of their respective Transportation Service Agreements ("TSAs"). The Pipeline is projected to be in service in the 1st half of 2016.

Notice of changes to the Open Season process and/or the Open Season Documents, if any, will be provided by email to potential shippers who have expressed an interest in obtaining capacity on the Pipeline and have received the Open Season Documents. Notice of such changes will also be posted on ETP's website at www.energytransfer.com/ops_etp_crude.aspx.

ETP Pipeline Facilities

The Pipeline will be comprised of three segments, as illustrated on the enclosed maps. The first segment will be located in Texas. The McLoving System will be an approximately 70-mile long gathering pipeline with a capacity of approximately 90,000 barrels per day and will be located in Reeves and Loving Counties, Texas. Judith Station, a trucking station with approximately 40,000 barrels of operational storage, will be constructed off of Highway 285 at the terminus of the pipeline in Loving County to facilitate truck loading and unloading. A central pump and tanks will also be installed at Judith Station to facilitate deliveries from the Pipeline into Sunoco's Delaware Basin Extension.

The other two segments will be located in New Mexico. The Red Hills System will be approximately 18 miles of gathering pipeline with a capacity of approximately 13,000 barrels per day and will be located in Lea County, New Mexico. The Red Hills Station, a pump and storage station, will be located on the Red Hills System about 5 miles from the Red Hills Delivery Point into the Delaware Basin Extension. The Shurvesah System will be made up of approximately 38 miles of gathering pipeline with a capacity of approximately 17,000 barrels per day and will also be located in Lea County, New Mexico. Crude oil will be gathered by this pipeline to Lea Station at the Delivery Point into the Delaware Basin Extension.

McLoving System. Click to view larger map.

Red Hills System. Click to view larger map.

Shurvesah System. Click to view larger map.

Proposed Tariff and Rate Structure

ETP is initially proposing one class of Committed Shipper service and one class of Uncommitted Shipper service. Both Committed Shippers and Uncommitted Shippers will pay the same tariff rates, which are based on volume tiers. The rate applicable to each Committed Shipper or Uncommitted Shipper will be based on the tier of volumes tendered for transportation on the Pipeline during a particular month. The rates will vary inversely based on the volume tier (i.e., the larger the volume tier, the lower the rate). However, during periods of prorationing, Committed Shippers will pay a premium rate that is $0.01 cent per barrel higher than the otherwise applicable tariff rate in order to receive priority service.

A Committed Shipper will commit acreage in accordance with the Tariff for an initial term of ten (10) years which can be extended for a single subsequent five (5) year period.

Up to ninety percent (90%) of the available Pipeline capacity will be reserved for Committed Shippers. At least ten percent (10%) of the available Pipeline capacity will remain open for Uncommitted Shippers.

Open Season Process

The Open Season will commence at 8:00 a.m. Central Time on August 5th, 2015 and end at 5:00 p.m. Central Time on September 4th, 2015. The Transportation Service Agreement for Committed Shippers (which includes as exhibits a pro forma rules and regulations tariff and pro forma rates tariff) will be provided as part of the Open Season following the execution of a Confidentiality Agreement. To obtain a Confidentiality Agreement, please submit a request to:

Orin Atkins
Director of Business Development
Telephone: (214) 840-5655
Email: Orin.Atkins@energytransfer.com

Interested parties must submit their bids for transportation service by completing and executing a TSA and transmitting it to ETP by 5:00 p.m. Central Time on or before September 4th, 2015. Any bid received after that deadline will be considered only at the election of ETP. ETP reserves the right to extend the deadline for submission of conforming bids.

The pro forma TSA includes places for each interested party to insert certain information, including, for example, the company's name, address and contact information and the commitment quantity, which shall be established both in the aggregate and by pipeline lateral, (based on the bidder's acreage dedication and its anticipated deliveries), and with respect to which the bidder wishes to be accorded firm transportation service rights. Any other modification to the provisions of the pro forma TSA is subject to acceptance or rejection by ETP, in its sole discretion, and may therefore render any such bid invalid. ETP may reject any signed TSA that is incomplete, is inconsistent with this Open Season, contains additional or modified terms, or is otherwise deficient in any respect. A bid will also be subject to ETP's review and verification of the bidding party's creditworthiness.

Post-Open Season Process

After the Open Season process has ended, ETP will make a decision on whether or not to proceed with the Pipeline as designed, and/or whether to modify the design of the Pipeline to add capacity. Prior to the time that all final TSAs are executed by the bidder and ETP, ETP reserves the right, in its sole discretion, to (1) modify any of the Open Season Documents, if necessary, as indicated by economic, engineering design, environmental, legal, or other factors, or (2) decide not to proceed with the transportation service commitment terms offered in the TSA and the Open Season. In such an event, ETP will notify all interested parties as soon as reasonably practicable. In the event ETP elects to proceed with construction of the Pipeline, ETP will execute each acceptable TSA and return an executed copy to each shipper along with a notification letter confirming its decision to proceed with the Pipeline, subject to the conditions precedent set forth in the TSA.

 

Disclaimer

This notification together with any and all documents related to the Open Season is provided for informational purposes only. Notwithstanding anything contained herein to the contrary, this notification, any related agreements and any other documents related to the Open Season are not intended to constitute, nor shall they be construed to constitute, an offer or any binding obligation whatsoever on ETP to proceed with the potential Pipeline project contemplated by the Open Season until ETP has countersigned and delivered a fully executed TSA (as defined in the Notice of Open Season) to an interested party. ETP reserves the right, in its sole discretion, to modify, terminate or extend the Open Season, in whole or in part, at any time and without advance notice, including without limitation, any ensuing discussions with any recipient of any documents related to the Open Season. ETP further reserves the right to modify or supplement any of the documents associated with the Open Season without notice.

Under no circumstances shall ETP or any of its members or any of its or their affiliated companies or any of its or their respective directors, officers, employees, agents, attorneys, advisers and representatives be responsible for any costs or expenses incurred by any recipient of any documents associated with the Open Season or any other liability incurred by any such recipient in connection with any investigation or evaluation of the Pipeline.