Tallgrass Energy Partners LP (TEP) announced the commencement of an underwritten public offering of 7,000,000 common units representing limited partner interests, subject to market conditions. TEP also plans to grant the underwriters a 30-day option to buy up to an additional 1,050,000 common units.

TEP plans to use the net proceeds from the offering to fund part of consideration for its potential acquisition of a 33.3% interest in Tallgrass Pony Express Pipeline LLC. Pony Express owns and is developing an oil pipeline project consisting of a 430-mile natural gas pipeline being converted to transport oil, a 260-mile southward pipeline extension from Guernsey, Wyo., to Cushing, Okla., and a 66-mile pipeline lateral in Northeast Colorado that will interconnect with the mainline. The mainline is expected to enter service during third-quarter 2014, and the lateral is expected to begin service during the first half of 2015. Tallgrass Development LP offered TEP the right to purchase the pipeline interest for total consideration of $600 million.