Phillips 66 Pipeline LLC, a wholly owned subsidiary of Phillips 66 (PSX - Free Report) announced that it will expand the capacity to transport refined petroleum products across the Houston Ship Channel via pipeline. Earlier the company completed a successful open season for the Cross-Channel Connector after receiving shipper commitments to utilize the additional capacity. In addition, Phillips 66 Pipeline LLC received positive response to a potential Phase 2 of the project and is proceeding with an evaluation of this expansion.
The company anticipates that the expansion project will be complete by the fourth quarter of 2014. The Cross-Channel Connector is expected to have a capacity of up to 180,000 barrels per day. The Phase 2 expansion could add an additional 50,000 barrels per day of capacity.
The Cross-Channel Connector project leverages existing assets and will combine a reactivated pipeline under the Houston Ship Channel along with the expansion of an active line in Pasadena. The company plans to connect to Magellan’s refined product pipeline which will allow the Cross-Channel Connector to transport refined petroleum products from the south of the Houston Ship Channel to Magellan Midstream Partners (MMP - Free Report) and Kinder Morgan Energy Partners LP on the north side of the channel at Galena Park and East Houston.
Phillips 66, an independent publicly traded company, was formed after the spin-off of the refining/sales business of ConocoPhillips (COP - Free Report) in May 2012. The move resulted in the creation of the largest refining company in the U.S. and the largest exploration and production player based on oil and gas reserves.
Phillips 66, is headquartered in Houston, Texas. In addition to the refining, marketing and transportation businesses, the company has emerged as an integrated downstream company with most of the Midstream and Chemicals segments, as well as power generation and certain technology operations included in the Emerging Businesses segment.
Phillips 66 currently holds a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.