MOSCOW (MRC) -- A 1 million b/d crude pipeline that would transport Permian Basin crude to the US Gulf Coast received the formal go-ahead from its backers and is expected online in the first half of 2021, according to a statement released Wednesday by partners ExxonMobil, Plains All American and Lotus Midstream, as per S&P Global.
"The new common-carrier pipeline system will provide more than 1 million b/d of crude oil and condensate capacity and will be constructed from the Permian Basin in West Texas to the Texas Gulf Coast," they said.
Plains, ExxonMobil and Lotus Midstream formed the Wink to Webster Pipeline LLC Joint Venture and have already ordered nearly 650 miles of domestically sourced 36-inch-diameter line pipe. Plains will be the operator of the line during the construction phase.
The pipeline announcement was expected after ExxonMobil on Tuesday confirmed it was beginning construction at its 365,644 b/d Beaumont, Texas, refinery of a 250,000 b/d crude unit to run the light, sweet oil produced from its holdings in the Permian Basin, which would provide shipping commitments substantial enough to make the pipeline commercially viable.
The pipeline will have origin points at Wink and Midland, Texas, and multiple destination points in the Houston area including Webster and Baytown, where ExxonMobil is currently expanding light sweet crude processing capacity at the 560,500 b/d refinery by about 60,000 b/d.
Pipeline connectivity will also be provided to Texas City and Beaumont, the project's backers said.
As MRC wrote before, in October 2017, ExxonMobil Chemical commenced production on the first of two new 650,000 tons-per-year high-performance polyethylene (PE) lines at its plastics plant in Mont Belvieu, Texas. The full project, part of the company’s multi-billion dollar expansion project in the Baytown area and ExxonMobil’s broader Growing the Gulf expansion initiative, will increase the plant’s PE capacity by approximately 1.3 million tons per year. The Mont Belvieu plant capacity will total more than 2.5 million tons per year, making it one of the largest polyethylene plants in the world. These performance polyethylene products will deliver significant sustainability benefits enabling lighter weight higher performance packaging, lower energy consumption and reduced emissions.
ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
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