Plains to Allocate Unused Cactus II Space to Committed Shippers
NEW YORK (Reuters) - Plains All American LP said on Wednesday it would allocate unused space on its Cactus II crude pipeline to committed shippers if spot shipments fall below the 10% of capacity set aside for those shipments.
The 670,000 barrel-per-day Cactus II oil pipeline system runs from the Permian basin to the Corpus Christi, Texas, area.
Plains has been scooping up crude barrels in recent weeks to fill the line ahead of the pipeline’s start up, market sources have said.
The change in allocation rules will be effective Wednesday, according to Plains’ filing with the U.S. Federal Energy Regulatory Commission (FERC).
Once the line fill is complete, commodities merchant Trafigura, one of the largest shippers on the line, will be shipping full contractual volumes, a source familiar with the matter told Reuters last month.
Trafigura signed a long-term agreement with Plains last year to transport a total of 300,000 bpd of crude and condensate on the Cactus II pipeline from the Permian basin, the biggest U.S. oilfield, to the port of Corpus Christi.
Plains said in June that the Cactus II project is on track for initial service by the end of the third quarter of 2019.
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