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Researched by Industrial Info Resources (Sugar Land, Texas)--Midstream company Plains All American Pipeline LP's (NYSE:PAA) (Houston, Texas) primary focus at the moment is moving crude oil from the Permian Basin and other areas to the U.S. Gulf Coast. To this end, Plains has initiated several growth projects and recently announced that it has increased its 2019 capital program by $250 million to about $1.35 billion.
In the company's recent earnings conference call, Plains Chief Executive Officer Willie Chiang spoke about some of the company's capital projects. Chiang said, "Since the beginning of 2018, we have added approximately 1.7 million barrels a day (BBL/d) of new Permian Basin system capacity, and by yearend, we expect this number to grow to more than 2.2 million BBL/d."
Among the company's underway projects is the Cactus II crude oil pipeline, which will run from the Permian Basin to the Ingleside/Corpus Christi area along the Texas Gulf Coast. The pipeline will transport 585,000 BBL/d of crude oil. Construction began last summer, with ITI International LLC (Houston) as a contractor. Chiang said, "Cactus II construction is progressing on schedule, with partial service to Ingleside expected to be complete in the third quarter of 2019 and full service to Corpus Christi expected by the first quarter of 2020." The project has an estimated total investment value (TIV) of $580 million. For more information, see Industrial Info's project reports on the Wink-McCamey segment and McCamey-Ingleside/Corpus Christi segment.
Plains also is developing a joint venture crude oil oil pipeline with Exxon Mobil Corporation (NYSE:XOM) (Irving, Texas) and Lotus Midstream (Sugar Land) that will run from Wink, Texas, in the Permian Basin to Webster, along the Texas Gulf Coast. Chiang said, "With respect to the Wink-to-Webster project, we are full-speed-ahead on progressing the project, which is targeted to be placed into service in the first half of 2021. We have ordered the majority of the long-lead materials, including 36-inch line pipe. We've progressed our construction contractor strategy by awarding several key contracts, with construction to begin later this year." The project has a TIV of $1.175 billion. For more information, see Industrial Info's project report.
Chiang said, "Beyond the Permian, we continue to advance several opportunities to leverage our existing pipeline systems and hub terminals. ... This includes the potential expansion and modest extension of our Diamond Pipeline, a reversal of the Capline system and an expansion on our Red River system. Each of these potential projects represents accretive, capital-efficient growth opportunities."
Plains' Diamond Pipeline will expand the 200,000-BBL/d crude oil pipeline in the Cushing, Oklahoma, area by an additional 200,000 BBL/d and extend it to connect with the Capline Pipeline, of which Plains will reverse the flow to run north to south 650 miles from Illinois to the Louisiana Gulf Coast. The pipeline carries 300,000 BBL/d. Construction is expected to kick off later this year, taking about a year to complete. For more information, see Industrial Info's project reports on the Diamond expansion, and the Illinois, Kentucky, Tennessee, Mississippi and Louisiana portions of the Capline reversal.
Plains will also expand its Red River system in Oklahoma to 250,000 BBL/d to increase the crude takeaway from Cushing. For more information, see Industrial Info's project report.
To support the Capline reversal, Plains plans to expand its terminal in Saint James, Louisiana. Chiang said, "At our Saint James hub terminal, we have sanctioned the construction of 2.4 million barrels of new crude oil storage capacity under a long-term third-party contract, targeted to be placed into service in the second half of 2020. This project will result in Plains operating more than 15 million barrels of crude storage capacity at St. James, which complements our existing connectivity, dock capacity and overall operating capabilities at one of the most strategic terminalling hubs along the U.S. Gulf Coast." For more information, see Industrial Info's project report.
Plains posted first-quarter 2019 net income of $970 million, compared with $288 million in first-quarter 2018.
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 the company's recent earnings conference call, Plains Chief Executive Officer Willie Chiang spoke about some of the company's capital projects. Chiang said, "Since the beginning of 2018, we have added approximately 1.7 million barrels a day (BBL/d) of new Permian Basin system capacity, and by yearend, we expect this number to grow to more than 2.2 million BBL/d."
Among the company's underway projects is the Cactus II crude oil pipeline, which will run from the Permian Basin to the Ingleside/Corpus Christi area along the Texas Gulf Coast. The pipeline will transport 585,000 BBL/d of crude oil. Construction began last summer, with ITI International LLC (Houston) as a contractor. Chiang said, "Cactus II construction is progressing on schedule, with partial service to Ingleside expected to be complete in the third quarter of 2019 and full service to Corpus Christi expected by the first quarter of 2020." The project has an estimated total investment value (TIV) of $580 million. For more information, see Industrial Info's project reports on the Wink-McCamey segment and McCamey-Ingleside/Corpus Christi segment.
Plains also is developing a joint venture crude oil oil pipeline with Exxon Mobil Corporation (NYSE:XOM) (Irving, Texas) and Lotus Midstream (Sugar Land) that will run from Wink, Texas, in the Permian Basin to Webster, along the Texas Gulf Coast. Chiang said, "With respect to the Wink-to-Webster project, we are full-speed-ahead on progressing the project, which is targeted to be placed into service in the first half of 2021. We have ordered the majority of the long-lead materials, including 36-inch line pipe. We've progressed our construction contractor strategy by awarding several key contracts, with construction to begin later this year." The project has a TIV of $1.175 billion. For more information, see Industrial Info's project report.
Chiang said, "Beyond the Permian, we continue to advance several opportunities to leverage our existing pipeline systems and hub terminals. ... This includes the potential expansion and modest extension of our Diamond Pipeline, a reversal of the Capline system and an expansion on our Red River system. Each of these potential projects represents accretive, capital-efficient growth opportunities."
Plains' Diamond Pipeline will expand the 200,000-BBL/d crude oil pipeline in the Cushing, Oklahoma, area by an additional 200,000 BBL/d and extend it to connect with the Capline Pipeline, of which Plains will reverse the flow to run north to south 650 miles from Illinois to the Louisiana Gulf Coast. The pipeline carries 300,000 BBL/d. Construction is expected to kick off later this year, taking about a year to complete. For more information, see Industrial Info's project reports on the Diamond expansion, and the Illinois, Kentucky, Tennessee, Mississippi and Louisiana portions of the Capline reversal.
Plains will also expand its Red River system in Oklahoma to 250,000 BBL/d to increase the crude takeaway from Cushing. For more information, see Industrial Info's project report.
To support the Capline reversal, Plains plans to expand its terminal in Saint James, Louisiana. Chiang said, "At our Saint James hub terminal, we have sanctioned the construction of 2.4 million barrels of new crude oil storage capacity under a long-term third-party contract, targeted to be placed into service in the second half of 2020. This project will result in Plains operating more than 15 million barrels of crude storage capacity at St. James, which complements our existing connectivity, dock capacity and overall operating capabilities at one of the most strategic terminalling hubs along the U.S. Gulf Coast." For more information, see Industrial Info's project report.
Plains posted first-quarter 2019 net income of $970 million, compared with $288 million in first-quarter 2018.
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.
