Phillips 66 Completes Major Capital Project in Face of Disappointing Earnings

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Researched by Industrial Info Resources (Sugar Land, Texas)--In a conference call on Friday regarding Phillips 66's (NYSE:PSX) (Houston, Texas) fourth-quarter 2016 earnings, executives discussed the company's past and current capital projects. Industrial Info is tracking more than $1.9 billion of Phillips 66 projects.

"We reached several milestones in our midstream growth activities in 2016," said Phillips 66 Chief Executive Officer Greg Garland. "At Freeport, we completed our 150,000-barrel-per-day (BBL/d) LPG (liquefied petroleum gas) export terminal." The Texas facility was constructed to meet the growing international demand for U.S. butane and propane. Construction began in early 2014 and was completed in November. The project had an estimated total investment value of $1 billion. "Commissioning went smoothly, and the facility is operating as designed. We shipped our first commercial cargo in mid-December, and we expect the facility to be loading to near capacity this month," said Garland. For more information, see Industrial Info's project report.

"In the Gulf Coast, the Beaumont (Texas) terminal expansion is ongoing," said Garland. "We commissioned 1.2 million barrels of contracted crude storage in the fourth quarter, and two million barrels of additional crude and product storage is expected to be available by mid-year." The project kicked off in summer of 2016. Chicago Bridge & Iron NV (NYSE:CBI) (The Hague, Netherlands) is the contractor on the project. For more information, see Industrial Info's project report. Garland suggested that more expansions may be coming at the facility. "We have plans to ultimately expand this facility to 16 million barrels," he said.

The company reported net income of $163 million, compared with $650 million in fourth-quarter 2015. "Market conditions continued to be challenging, and refining, marketing and chemicals margins were all lower," said Garland. "We also had significant turnarounds during the quarter. These factors contributed to our disappointing earnings."

Among the other projects being tracked by Industrial Info is a $170 million coker unit revamp at the company's refinery in Westlake, Louisiana. The project consists of upgrading the existing process technology and replacing four aging coke drums with larger ones to increase capacity from 50,000 BBL/d to 54,500 BBL/d. The project is planned to kick off early this year and will take about two months to complete. For more information, see Industrial Info's project report.

Also on the books is the modernization of the fluid catalytic cracking unit (FCCU) at Phillip 66's refinery in Linden, New Jersey. The project entails revamping the existing 150,000-BBL/d FCCU in order to increase gasoline yields by 4,000 BBL/d and reduce emissions. The project is planned to kick off this summer. Jacobs Engineering Group Incorporated (NYSE:JEC) (Pasadena, California) is performing engineering work on the project. For more information, see Industrial Info's project report.

The company is also revamping the 20,000-BBL/d FCCU at its refinery in Billings, Montana, to increase capacity by 2,000 to 4,000 BBL/d. The project kicked off in third-quarter 2016 and is expected to be completed this summer. For more information, see Industrial Info's project report.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.