Phillips 66 has accomplished the acquisition of EPIC Y-Grade GP LLC and EPIC Y-Grade LP for about $2.2 billion, boosting its midstream footprint within the Permian Basin.
The items, purchased from EPIC Midstream Holdings LP, personal pure gasoline liquids (NGL) pipelines, fractionation amenities and distribution methods.
“This transaction strengthens our place as a number one built-in downstream vitality supplier”, Don Baldridge, Phillips 66 govt vice chairman for midstream and chemical substances, stated in an organization assertion. “We’re evolving our portfolio and enhancing our capability to offer seamless and environment friendly supply of vitality merchandise.
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“Phillips 66 will provide producers unparalleled circulation assurance, whereas advancing a method that’s anticipated to ship engaging returns and create long-term worth for our shareholders”.
The acquired operations comprise two fractionators with a capability of170,000 barrels per day (bpd) close to Corpus Christi, Texas; purity distribution pipelines stretching about 350 miles; and an NGL pipeline round 885 miles lengthy and with a capability of 175,000 bpd. The NGL pipeline hyperlinks the Delaware, Midland and Eagle Ford basins to the fractionation complexes and Phillips 66’s Sweeny Hub, which has amenities for crude distilling, naphtha reforming, fluid catalytic cracking, alkylation and hydrodesulfurization, in addition to aromatics items, a vacuum distillation unit and a delayed coking unit.
The pipeline capability is being raised to 225,000 bpd, in a mission anticipated to be accomplished within the second quarter. An extra enlargement has additionally been sanctioned to develop the capability to 350,000 bpd; completion is predicted 2026. EPIC has additionally put in place plans to boost the fractionation capability to 280,000 bpd.
“The acquired belongings join Permian manufacturing to Gulf Coast refiners, petrochemical firms and export markets, and are extremely built-in with the Phillips 66 asset base”, Phillips 66 stated.
Asserting the settlement January 6, the corporate stated, “Phillips 66 doesn’t count on to extend its not too long ago introduced 2025 capital program in reference to that enlargement”.
On December 16, 2024, the Houston, Texas-based downstream oil and gasoline firm introduced $2.1 billion in capital for 2025, comprising $1.1 billion for progress and $998 million for sustaining capital.
Phillips 66 expects the acquisition to be “instantly accretive to earnings per share”.
Earlier than the EPIC settlement, Phillips 66 exceeded a $3 billion divestment plan meant to help its shareholder return goal and different long-term priorities.
“We intend to proceed to optimize the portfolio and rationalize non-core belongings going ahead”, chair and chief govt Mark Lashier stated in a press release December 16, 2024, saying an settlement to divest DCP GCX Pipeline LLC, which owns a 25 % non-operating stake within the Gulf Coast Specific Pipeline, to ArcLight Capital Companions LLC. “The evolution of our portfolio underscores our place as a number one built-in downstream vitality supplier, enhancing shareholder worth and positioning the corporate for the longer term”.
To contact the creator, e-mail jov.onsat@rigzone.com
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