Phillips 66 has signed a deal to accumulate EPIC Y-Grade GP LLC and EPIC Y-Grade LP for $2.2 billion, increasing its midstream footprint within the Permian Basin.
The 2, a part of EPIC Consolidated Operations LLC, personal pure fuel liquids (NGL) pipelines, fractionation services and distribution methods.
“This transaction bolsters Phillips 66’s place as a number one built-in downstream vitality supplier”, Phillips 66 chair and chief government Mark Lashier mentioned in a web based assertion Monday. “This transaction optimizes our Permian NGL worth chain, permits Phillips 66 to offer producers with complete move assurance, reaching fractionation services close to Corpus Christi, Sweeny, and Mont Belvieu, Texas, and is predicted to ship engaging returns in extra of our hurdle charges”.
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EPIC’s NGL operations comprise two fractionators with a capability of170,000 barrels a day 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 barrels per day. The NGL pipeline hyperlinks the Delaware, Midland and Eagle Ford basins to the fractionation complexes and Phillips 66’s Sweeny Hub, which has services 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.
“EPIC NGL is within the course of of accelerating its pipeline capability to 225 MBD [thousand barrels per day] and has sanctioned a second growth to extend capability to 350 MBD”, Phillips 66 mentioned.
“Phillips 66 doesn’t anticipate to extend its not too long ago introduced 2025 capital program in reference to that growth”, the Houston, Texas-based downstream oil and fuel firm mentioned. On December 16, 2024, Phillips 66 introduced $2.1 billion in capital for 2025, comprising $1.1 billion for progress and $998 million for sustaining capital.
“EPIC NGL has additionally recognized a 3rd fractionation facility that would carry its fractionation capability as much as 280 MBD”, Phillips 66 added. “The services join Permian manufacturing to Gulf Coast refiners, petrochemical firms, and export markets and can be extremely built-in with the Phillips 66 asset base”.
Phillips 66 expects the acquisition to be “instantly accretive to earnings per share”.
Beforehand Lashier mentioned the corporate had exceeded a $3 billion divestment plan meant to assist its shareholder return goal and different long-term priorities.
“We intend to proceed to optimize the portfolio and rationalize non-core property going ahead”, Lashier mentioned in an announcement December 16, 2024, asserting an settlement to divest DCP GCX Pipeline LLC, which owns a 25 p.c non-operating stake within the Gulf Coast Categorical 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 writer, electronic mail jov.onsat@rigzone.com
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