DCP Midstream Announces Additional Large Scale Expansion of Sand Hills Natural Gas Liquids Pipeline
May 30 2017 - 4:10PM
DCP Midstream, LP (NYSE:DCP) today announced an additional large
scale expansion of the Sand Hills natural gas liquids (NGL)
pipeline, with plans to initially spend $105 million towards
long-lead equipment and right-of-way. In a phased approach, this
expansion is designed to first increase capacity by 85 thousand
barrels per day (MBpd) up to approximately 450 MBpd. This initial
phase, when completed, is anticipated to include partial looping of
the pipeline and the addition of seven new pump stations at an
estimated total cost of $500 million. The expected in-service date
for this additional expansion project is the second half of 2018.
Additionally, future phased expansion may entail adding a full
loop of Sand Hills, which could increase capacity by over 100 MBpd
to a minimum of 550 MBpd.
The expansion announced today is in addition to the Sand Hills
Pipeline’s existing expansion to 365 MBpd, which is on target to be
in service in the fourth quarter of this year. This existing
expansion adds three additional pump stations and a lateral to
primarily increase Permian capacity. The expansion to 365 MBpd is
backed by long-term, third party plant dedications. Additionally,
multiple new supply connectors are in progress and will deliver
incremental NGL volumes in 2017 and beyond.
“DCP is uniquely situated through its premier integrated
logistics and G&P footprint to capture growth out of the
Delaware and Permian basins. We continue to high-grade our
strategic portfolio to focus on strong return, accretive, fee-based
growth projects at lower risk,” said Wouter van Kempen, chairman,
president and CEO of DCP Midstream. “The Sand Hills Pipeline has
been an incredible success story founded upon being a
producer-friendly pipe that offers flexibility and optionality
through our multiple delivery points serving the Gulf Coast. With
our phased expansion approach, we are able to match capital outlay
with supply growth.”
Proceeds from DCP’s recent divestiture of its non-core Douglas,
Wyoming natural gas gathering system will be deployed to partially
fund the initial phase of this additional strategic expansion,
which will provide strong, accretive, fee-based returns at lower
risk. The Sand Hills Pipeline is owned two-thirds by DCP, and
one-third by Phillips 66 Partners LP (NYSE:PSXP). Capital
investments are represented at 100 percent ownership levels.
ABOUT DCP MIDSTREAM, LP
DCP Midstream, LP (NYSE:DCP) is a midstream master limited
partnership, with a diversified portfolio of assets, engaged in the
business of gathering, compressing, treating, processing,
transporting, storing and selling natural gas; and producing,
fractionating, transporting, storing and selling NGLs and
recovering and selling condensate. DCP owns and operates more than
60 plants and 64,000 miles of natural gas and natural gas liquids
pipelines, with operations in 17 states across major producing
regions, and leads the midstream segment as one of the largest
natural gas liquids producers and marketers and one of the largest
natural gas processors in the U.S. Denver, Colorado based DCP is
managed by its general partner, DCP Midstream GP, LP, which is
managed by its general partner, DCP Midstream GP, LLC, which is
100% owned by DCP Midstream, LLC. DCP Midstream, LLC is a joint
venture between Enbridge and Phillips 66. For more information,
visit the DCP Midstream, LP website at www.dcpmidstream.com.
CAUTIONARY STATEMENTS
This press release may contain or incorporate by reference
forward-looking statements as defined under the federal securities
laws regarding DCP Midstream, LP, including projections, estimates,
forecasts, plans and objectives. Although management believes that
expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will
prove to be correct. In addition, these statements are subject to
certain risks, uncertainties and other assumptions that are
difficult to predict and may be beyond DCP's control. If one or
more of these risks or uncertainties materialize, or if underlying
assumptions prove incorrect, DCP's actual results may vary
materially from what management anticipated, estimated, projected
or expected. Factors that could cause actual results or events to
differ materially from those described in the forward-looking
statements are set forth in DCP’s filings with the Securities and
Exchange Commission. The forward-looking statements contained
herein speak as of the date of this announcement. DCP undertakes no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Investors or
Analysts:Irene Lofland, 303-605-1822Media:Roz Elliott,
303-605-1707 |
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