SAN ANTONIO, TEXAS - April 24, 2018 - Andeavor (NYSE: ANDV) today announced participation in two new joint ventures that support the transportation of crude oil from the Permian Basin to Corpus Christi, Texas with connection to a marine terminal under development.
Gray Oak Pipeline, LLC, a joint venture owned 75 percent by Phillips 66 Partners (NYSE: PSXP) and 25 percent by Andeavor, is a pipeline system providing crude oil transportation from West Texas to destinations in the Corpus Christi, Sweeny and Freeport areas. Origination stations will be constructed in Reeves, Loving, Winkler and Crane counties in West Texas, as well as from locations in the Eagle Ford area in South Texas. The pipeline is expected to be placed in service by the end of the fourth quarter of 2019 and is backed by long-term, third-party, take-or-pay commitments with primarily investment-grade customers.
Gray Oak Pipeline, LLC received enough volume commitments in the form of precedent agreements to hold a second binding open season. The ultimate scope and capacity of the pipeline will depend on the outcome of the open season. Subject to the results of the second open season, the Gray Oak Pipeline could transport up to 700,000 barrels per day of crude oil from the Permian Basin to downstream markets. Assuming the pipeline is fully subscribed, its capacity could ultimately be expanded to approximately 1 million barrels per day of long-haul takeaway. Phillips 66 Partners will construct and operate the pipeline.
In Corpus Christi, the Gray Oak Pipeline will connect to a new joint venture marine terminal, the South Texas Gateway Terminal, under development by Buckeye Partners, L.P. (NYSE: BPL). Buckeye will have a 50 percent interest in the joint venture terminal and will be the operator while Andeavor and Phillips 66 Partners will each have a 25 percent ownership interest. The terminal will have an initial storage capacity of 3.4 million barrels and is expected to begin operations by the end of 2019.
The combined system allows Andeavor to supply crude oil from its Delaware Basin gathering systems which further strengthens Andeavor's platform and enhances its commercial capability in the region, allowing Andeavor and its customers to access multiple markets on the U.S. Gulf Coast as well as other markets through the marine terminal. The system also supports the development of additional gathering projects in the Permian Basin by Andeavor Logistics, LP (NYSE: ANDX), and encourages high utilization of existing assets and assets under development by providing attractive takeaway capability from the basin.
Andeavor is a premier, highly integrated marketing, logistics and refining company. Andeavor's retail-marketing system includes more than 3,200 stores marketed under multiple well-known fuel brands, including ARCO®, SUPERAMERICA®, Shell®, Exxon®, Mobil®, Tesoro®, USA Gasoline(TM) and Giant®. It also has ownership in Andeavor Logistics LP and its non-economic general partner. Andeavor operates 10 refineries with a combined capacity of approximately 1.2 million barrels per day in the mid-continent and western United States.
About Andeavor Logistics LP
Andeavor Logistics LP is a fee-based, full-service, diversified midstream logistics company, with integrated assets across the western and mid-continent regions of the United States. Andeavor Logistics operates through three business segments: Terminalling and Transportation, Gathering and Processing and Wholesale. The Terminalling and Transportation segment consists of marine terminals, refined product truck terminals, rail terminals, dedicated storage facilities and transportation pipelines. The Gathering and Processing segment consists of crude oil gathering systems and pipelines as well as natural gas gathering pipelines, processing facilities and fractionation facilities. The Wholesale segment consists of a fee-based fuel wholesale business. Andeavor Logistics is a Delaware limited partnership formed by Andeavor, headquartered in San Antonio, Texas.
Forward Looking Statements
This release contains "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including without limitation statements concerning: expectations regarding the Gray Oak Pipeline joint venture and the marine terminal joint venture, including the construction of origination terminals, the results of a second open season for the pipeline, the quality, capacity and capabilities of the pipeline and marine terminal, when the pipeline and terminal are expected to be operational; our plans to integrate the pipeline and marine terminal with our operations, and the expected benefits therefrom. For more information concerning factors that could affect these statements, see Andeavor's and Andeavor Logistics' annual reports on Form 10-K, quarterly reports on Form 10-Q, and other public filings and press releases, available at www.andeavor.com and www.andeavorlogistics.com. We undertake no obligation to revise or update any forward-looking statements as a result of new information, future events or otherwise.
Brad Troutman, Vice President, Investor Relations, (210) 626-4757
Andeavor Logistics Investors:
Andrew Woodward, Sr. Director, Finance and Investor Relations, (210) 626-7202
Andeavor Media Relations, firstname.lastname@example.org, (210) 626-7702