Sunoco Logistics Announces Permian Express Project To Increase Crude Oil Outflow From West Texas By 150,000 BPD Expandable to 35

abarrelfullabarrelfull wrote on 21 Jun 2012 07:02
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Sunoco Logistics Partners L.P. (NYSE: SXL) announced today Permian Express, a new project to transport West Texas crude oil to Gulf Coast markets. Phase I of the project will have a capacity of approximately 150,000 barrels per day. Permian Express could be expanded to at least 350,000 barrels per day.

For Permian Express Phase I, Sunoco Logistics will offer approximately 150,000 barrels per day of crude oil service from Wichita Falls, Texas to the Nederland/Beaumont, Texas markets. Sunoco Logistics will reverse its Wortham-to-Wichita Falls pipeline to create continuous pipeline service from Wichita Falls to Nederland including utilizing excess capacity on the southern leg of the West Texas Gulf pipeline system.

Permian Express Phase I offers customers speed to market as it will be operational within 6 to 9 months with an initial capacity of 90,000 barrels per day. Full capacity of 150,000 barrels per day is expected within 12 to 18 months. In addition, to offer customers flexibility, commitment terms of three, five or seven years will be available. The Open Season for Phase I is anticipated to be launched within a week.

“With the use of pipe already in the ground, Permian Express Phase I offers West Texas producers and Gulf Coast refiners a fast and cost-efficient solution with tremendous operational flexibility,” said Michael J. Hennigan, Sunoco Logistics’ president and chief executive officer. “Having this project on-line within 6 to 9 months and offering flexible commitment terms makes Permian Express Phase I very attractive to shippers.”

A second phase could deliver additional West Texas crude oil to key Gulf Coast destinations such as the Nederland/Beaumont market and further east to the refining centers in Louisiana up to St. James using a combination of new and existing pipelines.

For Permian Express Phase II, Sunoco Logistics could twin a 300-mile pipeline, parallel to the existing West Texas Gulf pipeline, from Colorado City to Wortham where it could connect to the existing excess capacity of the southern leg of the West Texas Gulf pipeline system. Permian Express Phase II could have initial takeaway capacity of approximately 200,000 barrels per day and be operational in the second half of 2014.

Permian Express is separate from, but complements, Sunoco Logistics’ previously announced plans to expand crude oil outflow on the West Texas Gulf Pipeline by at least 100,000 barrels per day. In total, Sunoco Logistics’ currently announced projects could increase crude oil takeaway capacity from West Texas by at least 450,000 barrels per day.

“Our latest crude project demonstrates once again that our assets are attractively positioned to deliver Permian Basin crude oil to markets sought by producers and refiners,” Hennigan said. “Permian Express is consistent with our strategy of growing ratable, fee-based cash flow.”

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