A joint venture has been formed between Phillips 66, Energy Transfer Partners, L.P. and Sunoco Logistics Partners L.P. This venture was made to construct the Bayou Bridge pipeline to transport crude oil from the Phillips 66 and Sunoco Logistics terminals in Nederland, Texas, to Lake Charles, La. An expansion open season for service to the market hub in St. James, La. will be launched with the venture.
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 underway to deliver Bakken crude oil to the Gulf Coast.”
“Energy Transfer is excited to be part of the Bayou Bridge pipeline with our two joint venture partners,” said Lee Hanse, executive vice president of Energy Transfer Partners. “This project is the logical next step in our development of logistical infrastructure to move crude oil to market centers across the U.S., and we believe that it will be a critical conduit for our shippers to transport multiple grades of crude oil to the major refining market in Louisiana.”
“We are pleased to partner with Energy Transfer and Phillips 66 on the Bayou Bridge pipeline,” said Michael Hennigan, president and CEO of Sunoco Logistics. “We believe being connected to our 25 million barrel Nederland crude terminal on the Gulf Coast greatly benefits this project. Our extensive pipeline system connects our West Texas Permian; southern Oklahoma; Granite Wash, Texas; Eaglebine, Texas and East Texas systems to our Nederland terminal and now will have enhanced capability to further deliver crude barrels eastward on the Bayou Bridge pipeline into Louisiana.”
Construction is underway on the Nederland to Lake Charles segment of the pipeline, which will be 30-inch diameter and 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, La., which has a forecasted in-service date of the second half of 2017.
The binding expansion open season will commence in the third quarter of 2015. Bona fide potential shippers that would like to receive copies of the expansion open season documents, the throughput and deficiency agreement, and proposed tariffs must first sign a confidentiality agreement.