Phillips 66 (NYSE: PSX), Energy Transfer Partners LP (NYSE: ETP), and Sunoco Logistics Partners LP (NYSE: SXL) have formed a joint venture to construct the Bayou Bridge pipeline that will deliver crude oil from the Phillips 66 and Sunoco Logistics terminals in Nederland, Texas, to Lake Charles, Louisiana.
The joint venture will also launch an expansion open season for service to the market hub in St. James, Louisiana. Phillips 66 holds a 40% interest in the joint venture, and Energy Transfer and Sunoco Logistics each hold a 30% interest. Sunoco Logistics will be the operator of the system.
“The Bayou Bridge pipeline, combined with the storage and logistics capabilities of our Beaumont Terminal, provides enhanced opportunities to deliver North American heavy and light crudes into the Louisiana market that is heavily dependent today on marine and rail delivery of crude oil,” said Greg Garland, chairman and CEO of Phillips 66. “The pipeline also complements other pipeline projects we have under way to deliver Bakken crude oil to the Gulf Coast.”
Construction is under way on the Nederland to Lake Charles segment of the 30-inch-diameter pipeline, which is expected to begin commercial operations in the first quarter of 2016. The companies will also launch a binding expansion open season to assess additional shipper interest for service with connectivity to existing terminal infrastructure and refineries in and around the St. James area. The results of the expansion open season will be used to determine the size of the pipeline to St. James, which has a forecasted in-service date of the second half of 2017. The binding expansion open season will begin in the third quarter of 2015.