Seaway Pipeline Approves First Phase of Expansion of Gulf Coast to Cushing Crude Pipeline System

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26 February 1999

Seaway Pipeline Company, a general partnership between subsidiaries of ARCO and Phillips, has authorized the construction of two new storage tanks at its Jones Creek tank farm. The two new tanks will expand the shell tank storage capacity for Seaway at Jones Creek from 1.6 million barrels to 2.6 million barrels and increase the capacity of the Seaway crude system from approximately 220,000 BPD to 250,000 BPD.
The additional capacity will be available in January of 2000, which is the expected completion schedule for the first of the new tanks. The Jones Creek tank farm supports the off-loading operation of the Seaway Freeport terminal, the origin point for the Seaway 30" crude pipeline, which transports crude oil from Freeport, Texas to Cushing, Oklahoma.

"We are pleased that we will be able to meet the increasing needs of the marketplace for crude transportation services into the mid-continent and mid-west", said Larry Shakley, President of ARCO Pipe Line Company, operator of Seaway. "The extra tanks will also give Seaway the ability to handle additional varieties of crude while maintaining the high quality that has become synonymous with Seaway and its ability to deliver to the market."

Seaway has also approved engineering funds for three new pump stations for the crude system. Final approval for construction of the pump stations is expected early in the second quarter. The new pump stations, if approved, will be on-line in the first quarter of 2000. Together with the new tanks, the new pump stations will bring the Seaway crude system capacity to nominally 350,000 BPD.

Seaway is a partnership between subsidiaries of ARCO (NYSE: ARC) and Phillips (NYSE: P). Seaway also includes a 20" line transporting products from Houston to Cushing and a waterborne terminal at Texas City, which handles movements of imported crude oil from Texas City to refineries in the Houston area.


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