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New JV to construct oil pipeline

Phillips 66 and Plains All American Pipeline are teaming up to construct the US$2.5 billion Red Oak Pipeline System.

The two companies have formed a new joint venture (JV) known as Red Oak Pipeline LLC to construct the system, which will provide crude oil transportation services from Cushing, Oklahoma and the Permian Basin in West Texas to Corpus Christi, Ingleside, Houston and Beaumont, Texas.

The JV will construct a new 30 inch (762 mm) pipeline from Cushing to Wichita Falls and Sealy, Texas, before installing a 30 inch pipeline segment to Corpus Christi and Ingleside as well as a 20 inch (508 mm) section to Houston and Beaumont.

Red Oak plans to use existing pipeline and utility corridors where feasible, with Plains leading project construction and Phillips to operate the pipeline.

Phillips Chair and CEO Greg Garland said the project was aligned with the company’s midstream business strategy.

“We are pleased to partner with Plains to build Red Oak,” he said. 

“The pipeline provides a competitive outlet for shippers to access the key market centres along the Texas Gulf Coast from Cushing and the Permian.”

Red Oak has already made a series of long-term shipper volume commitments and initial service from Cushing to the Gulf Coast is planned for the first quart of 2021, subject to approvals.

If you have a project you would like featured in Pipelines International contact Assistant Editor Chloe Jenkins at cjenkins@gs-press.com.au

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