Feb 05, 2004 |
PAA Announces Intent to Expand Basin Pipeline System |
(Houston – February 5, 2004) Plains All American Pipeline, L.P. (NYSE: PAA) today announced its intent to increase the transportation capacity of a portion of the Basin Pipeline System, which transports crude oil from the Permian Basin of West Texas to Cushing, Oklahoma, one of the largest and most liquid crude oil markets in North America.
The pipeline segment to be expanded extends approximately 345 miles from Colorado City, Texas, to Cushing where it interconnects with Plains All American’s Cushing Terminal, other crude oil terminals and major pipelines bound for the Mid-Continent and Midwest regions of the United States. The expansion project principally involves the reactivation of several pump stations located along the pipeline system. The Partnership expects to complete the project in March 2004. Upon completion of the expansion, total capacity on this segment of the pipeline is expected to increase approximately 15%, from its current average capacity of approximately 350,000 barrels per day to approximately 400,000 barrels per day. The Partnership is also evaluating the potential expansion of the segment of the Basin system from Midland to Colorado City.
“We believe that the Basin Pipeline System is the premier transportation route to Midwestern markets for crude oil produced in the Permian Basin,” said Greg L. Armstrong, Chairman and Chief Executive Officer of Plains All American.
“This expansion will enable us to better serve the needs of our pipeline customers and improve market access for crude oil producers in West Texas. In addition, at an estimated cost of approximately $1.1 million, we believe this project to be an excellent long term investment for the Partnership.”
Armstrong noted that since Plains All American assumed the operations of the Basin system on August 1, 2002, shipments on Plains All American’s space on Basin have increased from a run rate of approximately 237,000 barrels per day for the third quarter of 2002 to an average of 301,000 barrels per day for the third quarter of 2003. Plains All American owns an average 87% interest in the Basin Pipeline System.
“Our expansion of the system underscores the successful execution of the Partnership’s post-acquisition business plan for this asset,” said Armstrong.
“Although the volume on the Basin Pipeline System varies from month to month, we believe that this expansion will enhance our ability to accommodate peak volumes and position us well for the long term.”
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risks and uncertainties. These risks and uncertainties include, among other things, declines in volumes shipped on the Basin Pipeline and our other pipelines by third party shippers, the availability of adequate supplies of and demand for crude oil in the areas in which we operate, unanticipated shortages or cost increases in power supplies, materials and skilled labor, weather interference with business operations or project construction, the effects of competition, the success of our risk management activities, the impact of crude oil price fluctuations, continued credit worthiness of, and performance by, our counterparties, successful third party drilling efforts in areas in which we operate pipelines or gather crude oil, and other factors and uncertainties inherent in the marketing, transportation, terminalling, gathering and storage of crude oil and liquefied petroleum gas (“LPG”) discussed in the Partnership’s filings with the Securities and Exchange Commission.
Plains All American Pipeline, L.P. is engaged in interstate and intrastate crude oil transportation, terminalling and storage, as well as crude oil and LPG gathering and marketing activities, primarily in Texas, California, Oklahoma and Louisiana and 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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