700,000 barrel Texas crude pipeline to begin construction
Gray Oak Pipeline, a joint venture owned 75% by Phillips 66 Partners and 25% by Andeavor, has received enough bidding commitments to begin construction. The pipeline system will provide crude oil transportation from West Texas to facilities on the Texas coast and is expected to be placed in service by the end of the fourth quarter of 2019.
There will to be a second binding open season for pipeline capacity at 3 pm CDT on 26 April 2018.
Subject to the results of the second open season, the Gray Oak Pipeline could transport up to 700,000 barrels per day of crude oil from the Permian Basin to downstream markets. Assuming the pipeline is fully subscribed, its capacity could be expanded to approximately 1 million barrels per day. Phillips 66 Partners will construct and operate the pipeline.
In Corpus Christi, a coastal city in Texas, the Gray Oak Pipeline will connect to a new joint venture marine terminal under development by Buckeye Partners. Buckeye will have a 50% interest in the terminal joint venture and will be the operator, while Phillips 66 Partners and Andeavor each will have a 25% ownership interest. The terminal will have an initial storage capacity of 3.4 million barrels and is expected to begin operations by the end of 2019.