Midstreamer NuStar Energy LP has unveiled plans to boost capacity by 6,000 b/d on a 293-mile refined products pipeline that runs from the Panhandle in Texas to Albuquerque, NM.

refined product demand

The San Antonio-based limited partnership said Wednesday it would upgrade pump stations on the 17.2 million b/d Amarillo-to-Albuquerque Pipeline, which it jointly owns with Phillips 66 Partners LP

NuStar also plans to install “larger and more efficient electric pumps and a modern, efficient, diesel-driven pump” to improve flow and reduce emissions by eliminating two pump stations. The project is expected to be completed by mid-2022.

CEO Brad Barron said the upgrades would help ensure ample supply of refined products, including gasoline, jet fuel and diesel, for the Albuquerque market after the closure of the Gallup refinery in New Mexico last year.

NuStar infrastructure is concentrated in the Permian Basin and Eagle Ford Shale. It also has oil exporting facilities in South Texas in the Port of Corpus Christi.

Last year, NuStar received a $400 million capital commitment from Camelback Midstream Holdings and a separate $750 million to help improve the bottom line.

In its 4Q2020 report, the company said refined product demand had improved steadily over the summer after the pandemic forced lockdowns in the spring. As of January, the refined products systems had recovered to almost 100%, “in line with pre-pandemic volumes,” Barron said at the time.

Houston-based BWC Terminals in December completed a $106 million acquisition from NuStar of liquid storage assets in Texas City, which is southeast of Houston on the coast near Galveston. BWC provides bulk liquid storage and logistics services with terminals across 13 states.

Barron at the time said it was a “difficult decision” to divest the terminal assets, but it allowed the company to reduce debt and self-fund a larger proportion of the capital program.