ONEOK Partners, Barcus settle lawsuit over pipeline joint venture
BY ROD WALTON World Staff Writer
Saturday, March 16, 2013
3/16/13 at 7:28 AM
Barcas LLC is settling a Tulsa County lawsuit alleging that ONEOK Partners LP violated terms of an ill-fated, $1.8 billion deal to build a crude oil pipeline from the Bakken Shale in the northern Great Plains to the Cushing storage hub.
Houston-based Barcas issued a news release Friday that said it had entered into a confidential settlement with Tulsa-based ONEOK Partners.
Barcas filed the lawsuit in September, alleging that its Tulsa counterpart in the joint venture was in breach of contract, committed possible fraud and unjustly tried to enrich itself. ONEOK Partners scrapped plans for the $1.8 million Bakken Crude Express two months after the lawsuit.
"As part of the confidential settlement, Barcas has retracted all allegations of wrongdoing by ONEOK Partners, including, but not limited to, all charges that ONEOK Partners personnel misrepresented any facts," the Barcas statement says.
"Additionally, the parties have dismissed their respective claims against each other," it said. "The terms of the settlement include a reimbursement to Barcas of expenses it incurred in the development of the project."
Barcas originally sued for damages of more than $10 million.
The two companies had worked together since early 2012 on developing the 1,300-mile pipeline project and trying to secure long-term commitments from oil producers in the liquids-rich Bakken Shale fields of North Dakota and eastern Montana.
At some point, the lawsuit alleges, ONEOK Partners "cut Barcas out of the equation" by secretly initiating its own contacts with third-party customers.
ONEOK Partners, which would not comment on Friday's settlement announcement, previously denied any wrongdoing. In November, the company announced it would not build the Bakken Crude Express due to a lack of long-term commitments by oil producers to use the pipeline.
Barcas is headed by Kevin Foxx, a co-founder of Tulsa-based SemGroup LP and one-time CEO of SemGroup Energy Partners LP, which later became Blueknight Energy Partners. Foxx stayed on to guide SGLP for more than a year after the parent SemGroup filed for Chapter 11 bankruptcy and later emerged as SemGroup Corp.
He helped start Barcas several years ago. The company operates crude oil transport services in Oklahoma, Texas, Colorado, Wyoming, Louisiana and New Mexico.
Original Print Headline: Barcas settles suit against ONEOK Partners
Rod Walton 918-581-8457