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Researched by Industrial Info Resources (Sugar Land, Texas)--With COVID-19 numbers at a record high in the U.S., midstream companies have had a tough year and are bracing for an uncertain post-pandemic world where the game has changed. To this end, it should come as little surprise that midstream company Phillips 66 (NYSE:PSX) (Houston, Texas) is lowering its capital spending in the upcoming year, setting the forecast at $1.7 billion, more than 40% lower than this year's spending.
In a press release, Phillips 66 Greg Garland said, "We continue to focus on reducing capital expenditures as market conditions remain challenged. We are prioritizing completion of in-progress projects, as well as advancing our investments in renewable fuels." The company has allocated $776 million for its Refining segment and $610 million on midstream. Among Phillips 66's renewable fuels projects is the conversion of its 120,000-barrel-per-day (BBL/d) refinery in Rodeo, California, to produce 800 million gallons per year of renewable diesel, renewable gasoline and sustainable jet fuel from used cooking oils, fats, greases and soybean oils. The project is expected to be completed in 2024. For more information, see Industrial Info's project report.
Phillips 66 said $255 million in its Refining segment would be allocated "to fund high-return, quick-payout projects to enhance margins by improving clean product yields and reducing feedstock costs." Among projects meeting these criteria is the upgrade of the Fluid Catalytic Cracking Unit (FCCU) at its refinery in Ponca City, Oklahoma, which kicked off last year. The upgrade will improve yields of gasoline, propylene, butylene and isobutene by installing a new rider and feed nozzle and new reactor vessel, among other improvements. Hargrove Engineers and Constructors (Houston) is providing engineering, procurement and construction (EPC) on the project, which is expected to be completed early next year. For more information, see Industrial Info's project report.
Phillips 66 also is upgrading and expanding the 38,000-BBL/d hydrocracker at its Wood River Refinery in Roxana, Illinois. The project entails modifying four existing reactors and the main fractionation column as well as installing two new reactors to increase capacity to approximately 40,000-45,000 BBL/d. The project is expected to be completed in the first half of next year. For more information, see Industrial Info's project report.
Among the projects specifically mentioned by Phillips 66 in its Midstream segment is the construction of a fourth fractionator at its Sweeny Hub in Old Ocean, Texas. The 150,000-BBL/d Frac 4 will bring the facility's fractionation capacity to more than 500,000 BBL/d and will help provide ethane, propane, isobutane, normal butane and natural gasoline to the petrochemical and hearing markets. S&B Engineers and Constructors Limited (Houston) is providing EPC services on the project, which is expected to be completed in the second half of 2024. For more information, see Industrial Info's project report.
Lacking in Phillips 66's announcement was mention of any crude oil pipelines. While drilling in the oil patch is picking up from its previous lows this year, the outcome for demand in a post-pandemic world remains uncertain, and Phillips 66 seems to be playing it cautiously in this area. In March, as the pandemic shut down businesses and schools throughout the U.S., rapidly decreasing U.S. oil demand, Phillips 66 announced that would it would defer some planned crude oil pipeline projects, including the Red Oak and Liberty pipelines.
The Liberty Pipeline would transport light crude oil 1,300 miles from Wyoming and other points to Texas. The pipeline would carry 350,000 BBL/d. Click here for a list of related projects. The Red Oak Pipeline is a joint venture with Plains All American Pipeline (NYSE:PAA) (Houston) and would carry crude oil from Cushing, Oklahoma, and the Permian Basin in West Texas to the Texas Gulf Coast. The pipeline would transport up to 400,000 BBL/d. Click here for a list of related projects. The financial investment decisions for both projects have been delayed because of COVID-19-related issues.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 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.
In a press release, Phillips 66 Greg Garland said, "We continue to focus on reducing capital expenditures as market conditions remain challenged. We are prioritizing completion of in-progress projects, as well as advancing our investments in renewable fuels." The company has allocated $776 million for its Refining segment and $610 million on midstream. Among Phillips 66's renewable fuels projects is the conversion of its 120,000-barrel-per-day (BBL/d) refinery in Rodeo, California, to produce 800 million gallons per year of renewable diesel, renewable gasoline and sustainable jet fuel from used cooking oils, fats, greases and soybean oils. The project is expected to be completed in 2024. For more information, see Industrial Info's project report.
Phillips 66 said $255 million in its Refining segment would be allocated "to fund high-return, quick-payout projects to enhance margins by improving clean product yields and reducing feedstock costs." Among projects meeting these criteria is the upgrade of the Fluid Catalytic Cracking Unit (FCCU) at its refinery in Ponca City, Oklahoma, which kicked off last year. The upgrade will improve yields of gasoline, propylene, butylene and isobutene by installing a new rider and feed nozzle and new reactor vessel, among other improvements. Hargrove Engineers and Constructors (Houston) is providing engineering, procurement and construction (EPC) on the project, which is expected to be completed early next year. For more information, see Industrial Info's project report.
Phillips 66 also is upgrading and expanding the 38,000-BBL/d hydrocracker at its Wood River Refinery in Roxana, Illinois. The project entails modifying four existing reactors and the main fractionation column as well as installing two new reactors to increase capacity to approximately 40,000-45,000 BBL/d. The project is expected to be completed in the first half of next year. For more information, see Industrial Info's project report.
Among the projects specifically mentioned by Phillips 66 in its Midstream segment is the construction of a fourth fractionator at its Sweeny Hub in Old Ocean, Texas. The 150,000-BBL/d Frac 4 will bring the facility's fractionation capacity to more than 500,000 BBL/d and will help provide ethane, propane, isobutane, normal butane and natural gasoline to the petrochemical and hearing markets. S&B Engineers and Constructors Limited (Houston) is providing EPC services on the project, which is expected to be completed in the second half of 2024. For more information, see Industrial Info's project report.
Lacking in Phillips 66's announcement was mention of any crude oil pipelines. While drilling in the oil patch is picking up from its previous lows this year, the outcome for demand in a post-pandemic world remains uncertain, and Phillips 66 seems to be playing it cautiously in this area. In March, as the pandemic shut down businesses and schools throughout the U.S., rapidly decreasing U.S. oil demand, Phillips 66 announced that would it would defer some planned crude oil pipeline projects, including the Red Oak and Liberty pipelines.
The Liberty Pipeline would transport light crude oil 1,300 miles from Wyoming and other points to Texas. The pipeline would carry 350,000 BBL/d. Click here for a list of related projects. The Red Oak Pipeline is a joint venture with Plains All American Pipeline (NYSE:PAA) (Houston) and would carry crude oil from Cushing, Oklahoma, and the Permian Basin in West Texas to the Texas Gulf Coast. The pipeline would transport up to 400,000 BBL/d. Click here for a list of related projects. The financial investment decisions for both projects have been delayed because of COVID-19-related issues.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 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.
