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Plains All American Expanding Delaware Crude Takeaway in Permian

More crude oil takeaway is set to be built from the Permian Basin to Cushing, OK, following a successful open season by a subsidiary of Plains All American Pipeline LP (PAA).

The Houston-based partnership said it received enough committed volumes from shippers to expand portions of its pipeline systems to accommodate adding 120,000 b/d from the Delaware sub-basin to Cushing.

PAA in January bought Alpha Holding Co. LLC, serving Delaware oil producers through the Alpha Crude Connector, from owners Concho Resources Inc., a big Permian producer, and Frontier Midstream Solutions LLC.

“This expansion will allow us to meet shipper needs in a phased approach, while building in capability for further expansions,” said PAA COO Willie Chiang. “The project also enhances our integration by enabling additional volume pull-through from our Permian Basin gathering assets, and provides incremental supply optionality for pipelines that transport crude oil from Cushing to end markets, including our Red River and Diamond pipelines.”

The committed volume is to move on a combination of new and existing pipelines within Texas. The partnership plans to extend its Sunrise Pipeline system, which originates in Midland and connects in Colorado City, by building 180 miles of 24-inch pipeline from Colorado City to Wichita Falls.

The balance of the capacity would be provided by a combination of spare capacity and capacity enhancements to existing pipelines, which include capacity expansions to the Delaware sub-basin system of up to 200,000 b/d.

The pipeline system would deliver to PAA and third-party terminals. Subject to receiving timely approvals, PAA estimated the additional capacity could be operational by mid-2019.

The partnership also is expanding capacity to 390,000 b/d on the Cactus Pipeline in West Texas, which runs from McCamey to Gardendale, TX. The expansion, set to be ready in the third quarter, would move crude from the Permian to Corpus Christi, TX.

Additionally, BridgeTex Pipeline Co. LLC, in which it owns a half-stake is expanding capacity to 400,000 b/d on the BridgeTex Pipeline from Colorado City to Houston.

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