Kinder Morgan Energy Partners and Phillips 66 have entered
into an agreement for Kinder Morgan to transport Eagle Ford
crude and condensate to Phillips 66's Sweeny refinery in Brazoria County, Texas,
the companies said on Thursday.
Under the agreement, Kinder Morgan said it plans to build a
27-mile, 12-inch diameter lateral pipeline to extend its Kinder
Morgan Crude Condensate (KMCC) pipeline.
Kinder Morgan will provide Phillips 66 with a significant
portion of the lateral pipeline's initial 30,000 bpd of
capacity, which is expandable to 100,000 bpd, the company
The Phillips 66 Sweeny refinery has 247,000 bpd of
Kinder Morgan will invest approximately $90 million in the project, which also involves adding
associated receipt facilities by building a five-bay
truck offloading facility and three new storage tanks with
roughly 360,000 bbl of crude/condensate capacity in DeWitt
County and Wharton County, Texas.
Pending receipt of environmental and regulatory
approvals, construction is scheduled to begin
in the fourth quarter of 2012.
This pipeline lateral will provide yet another
attractive delivery point for customers of our KMCC pipeline
while providing Phillips 66 with enhanced access to
price-advantaged Eagle Ford crude and condensate, said
Tom Bannigan, president of KMP Products Pipelines.
Kinder Morgan's crude/condensate pipeline, which was ready
for service in June 2012, transports crude/condensate from the
Eagle Ford shale to the Houston Ship Channel through 65 miles
of new-build construction and 113 miles of
converted natural gas pipeline.
This agreement aligns with a fundamental part of the
Phillips 66 business strategy to get advantaged crude to our
refineries, said Glenn Simpson, general manager for
Phillips 66 Crude & International Supply.