Jun 25, 2001 |
PAA to Proceed With Phase II Expansion of Cushing Terminal Facility; Increase Capacity by 35% |
(Houston – June 25, 2001) Plains All American Pipeline, L.P. (NYSE: PAA) announced today it will proceed with the Phase II expansion of its Cushing Terminal Facility. Under the Phase II expansion, Plains All American will construct approximately 1.1 million barrels of additional tankage at its crude oil storage and terminal facility located in Cushing, Oklahoma. The new project will expand the total capacity of the facility to approximately 4.2 million barrels and is expected to cost approximately $11 million. Contracts for the expansion project are expected to be awarded in the next two months and construction will begin shortly thereafter. The new tanks are expected to be placed in service by mid-2002. Plains All American has already received the required permits and approvals from the applicable regulatory agencies. Construction of the original Cushing Terminal was completed in 1994 with an initial capacity of 2.0 million barrels. The Phase I expansion was completed in mid-1999 and added approximately 1.1 million barrels of additional tank capacity. Greg L. Armstrong, Chairman and CEO of Plains All American, said, “This expansion project will enable us to better service the needs of our existing customers and position us to handle the ever increasing varieties and grades of crude oil in Cushing.” Armstrong noted that the Cushing Terminal is one of the most modern, large-scale crude oil terminalling facilities in the United States, incorporating extensive environmental safeguards and operational enhancements designed to safely and efficiently terminal, store, aggregate and segregate large volumes and multiple varieties of both foreign and domestic crude oil. Plains All American’s existing facility consists of fourteen 100,000 barrel tanks, four 150,000 barrel tanks, four 270,000 barrel tanks and a manifold and pumping system capable of handling up to 800,000 barrels of crude oil throughput per day. “With our country facing one of the most challenging energy crises in recent history, we are extremely pleased to announce this investment in our nation’s energy infrastructure. This added tank capacity will help to ensure the continued flow of crude oil to Midwestern refineries where it is converted into petroleum products for the American consumer. Moreover, our strategic position in Cushing will enable us to benefit from increasing volumes and varieties of crude oil, whether those volumes are initiated by increased domestic production, as contemplated by the President’s National Energy Policy, or by increased imports of foreign crude oil.” Harry N. Pefanis, President and COO of the Partnership, said, “This increase in our storage and terminalling capacity will provide further stability to our gathering and marketing activities during periods of extreme price volatility. Combined with tankage related to our two recent Canadian acquisitions, our total storage capacity now exceeds 10 million barrels, most of which is strategically located at major trade locations and aggregation points. We believe the strategic position of our world-class Cushing Terminal complements our Canadian assets and better positions us to meet the needs of our customers in the Midwest.” Cushing, Oklahoma, is the official designated delivery location for crude oil futures contracts traded on the New York Mercantile Exchange. Plains All American is the largest independent owner and operator of storage and terminalling capacity in Cushing and its facility is an approved NYMEX delivery location. The Phase II expansion will increase Plains All American’s capacity in Cushing by approximately 35% and will consist of four tanks having a shell capacity of approximately 270,000 barrels each. Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risks and uncertainties, including risks and uncertainties typically associated with construction projects, such as unanticipated shortages of materials or skilled labor, weather interference or cost increases. The risks and uncertainties associated with the Partnership’s business include, among other things, demand for various grades of crude oil and resulting changes in pricing conditions, successful third party drilling efforts and completion of announced oil-sands projects, availability of third party production volumes for transportation and marketing, regulatory changes, the availability of acquisition opportunities on terms favorable to the Partnership, the availability to Plains All American of credit on satisfactory terms, successful integration and future performance of recently acquired assets, and other factors and uncertainties inherent in the marketing, transportation, terminalling, gathering and storage of crude oil discussed in the Partnership’s filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the period ended December 31, 2000, and quarterly report on Form 10-Q for the period ended March 31, 2001. Plains All American Pipeline, L.P. is engaged in interstate and intrastate crude oil transportation, terminalling and storage, as well as crude oil gathering and marketing activities, primarily in Texas, Oklahoma, California, Louisiana, Illinois and the Gulf of Mexico and in the Canadian Provinces of Alberta and Saskatchewan. The Partnership’s common units are traded on the New York Stock Exchange under the symbol “PAA”. The Partnership is headquartered in Houston, Texas. |
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