Phillips 66 Partners Takes 50% Interest in $1.6-Billion Liberty Pipeline Project
Phillips 66 Partners LP said it has reached agreement with Phillips 66 to acquire its 50% interest in the Liberty Pipeline project for approximately $75 million. Phillips 66 Partners added that it plans to fund the transaction through a combination of cash on hand and the revolving credit facility. The transaction is expected to close on 2 March, with an effective date of 1 March.
Phillips 66 Partners is a growth-oriented master limited partnership formed by Phillips 66 to own, operate, develop, and acquire primarily fee-based crude oil; refined petroleum products; and natural gas liquids pipelines, terminals, and other midstream assets.
Phillips 66 announced in June 2019 with Bridger Pipeline LLC the formation of a 50/50 joint venture, Liberty Pipeline LLC, and were proceeding with construction of the Liberty Pipeline. The 24-in. pipeline will provide crude oil transportation service from the Rockies and Bakken production areas to Cushing, Oklahoma. The pipeline is underpinned with long-term volume commitments.
Service on the pipeline is targeted to commence in the first half of 2021. The cost of the pipeline is expected to be approximately $1.6 billion, on a gross basis, or $800 million net to Phillips 66 Partners.
“The Liberty Pipeline is a great addition to the Phillips 66 Partners portfolio,” said Greg Garland, Phillips 66 Partners’ chairman and CEO. “It is a strong organic project and continues our strategy of growing PSXP with stable fee-based cash flows, supported by long-term volume commitments.”
Garland added that Phillips 66 Partners is well positioned to execute this pipeline project on the heels of successfully starting up the Gray Oak Pipeline.
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