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Berkshire Hathaway Builds Stake in Phillips 66

Warren Buffett's Berkshire Hathaway Inc. on Friday disclosed a near-11% stake worth $4.48 billion in Phillips 66, improving its bet on growth in U.S. pipelines and onshore liquids.

In a filing with the Securities and Exchange Commission, Berkshire revealed that it holds 57.98 million shares in Phillips, or about 10.8% of the company. Berkshire in late 2013 bought subsidiary Phillips Specialty Products Inc. using $1.35 billion in stock it already held in Phillips (see Daily GPIDec. 31, 2013).

The investment giant long has been a shareholder in former parent ConocoPhillips, which spun off Phillips in 2012 (see Daily GPIApril 17, 2012).

Phillips in the past few years has been expanding its midstream offerings (see Daily GPIFeb. 17). It has a liquefied petroleum gas export terminal underway at an existing marine facility in Freeport, TX scheduled to be completed next year (see Daily GPIAug. 21Nov. 4, 2013). It also owns fractionation capacity and operates Gulf Coast Fractionators in Texas, and has capacity at the Enterprise Mont Belvieu Fractionator in Texas and Conway Fractionator in Kansas.

Berkshire Hathaway Energy, the umbrella for the energy investments, owns or holds shares in an arsenal of U.S. pipelines, railroads, utilities and oil and gas producers. It paid close to $37.2 billion in early August for Portland, OR-based Precision Castparts Corp., which makes parts for the energy and aerospace industries (see Daily GPIAug. 10). It also owns Kern River Gas Transmission, Northern Natural Gas, PacifiCorp and NV Energy Inc. BNSF Railway Co. moves crude oil across North America and is testing natural gas-fueled locomotive engines (see Daily GPIMarch 8, 2013).

Lubrizol, which Berkshire acquired in 2011, last year bought two Weatherford International plc businesses based in Texas (see Shale Daily, Dec. 1, 2014). It also owns shares of ExxonMobil Corp., National Oilwell Varco and Suncor Energy Inc., among others (see Daily GPI, Nov. 15, 2013).

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