HomeNewsPlains Says Reversed Capline Crude Pipeline Service to Begin 2020

Plains Says Reversed Capline Crude Pipeline Service to Begin 2020

2/6/2019

 

NEW YORK (Reuters) – Plains All American Pipeline said on Tuesday it expects the reversed Capline crude pipeline, from the U.S. Midwest to the Gulf Coast, to begin service in the third quarter of 2020.

The target in-service date for the reversed line is third quarter 2020 for light oil service and early 2022 for heavy oil service, the company said on its quarterly earnings call with analysts.

“The capacity from Cushing (Oklahoma) down to St. James (Louisiana) should be available on a quicker time frame than heavy moving down from Patoka (Illinois),” CEO Willie Chiang said on the call.

Pending a successful open season, in which companies gauge shipper interest for the proposal, the Cushing to St. James movement would include a 200,000 bpd of expansion and a modest extension of the Diamond JV pipeline that will connect to Capline, Plains said.

Capline is the largest crude pipeline that currently runs from the Gulf Coast to refineries in the Midwest. Volumes on Capline, once a major artery for imports and Gulf of Mexico crude used by U.S. Midwest refiners, have declined sharply as the U.S. shale boom pushed inland crude to the East Coast and Gulf Coast.

The company said it is also making progress on its Cactus II pipeline with partial service expected in late third quarter of 2019 and full-service plan by April 2020.

Plains said its Corpus Christi, Texas and St. James facilities could both could explored further for crude export capabilities.

“We think we're the best solution to get barrels to the coast and what we strive to do is to have connectivity to the many, many docks that are being expanded to be able to get access to water ... so far there's been a lot of interest in us being able to get connections,” Chiang said.

Plains has previously said it was monitoring demand for building a crude export facility capable of handling supertankers.

Several midstream companies have announced multimillion-dollar crude terminals along the Gulf Coast looking to take advantage of a surge in U.S. crude exports.

Plains said it has a 20% ownership interest in the joint venture with ExxonMobil and Lotus Midstream for a pipeline system that is expected to provide more than 1 MMbpd of crude and condensate capacity from the Permian Basin to the Texas Gulf Coast.

Plains expects a net 2019 capital investment of about $250 million toward the project.

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