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Crude volumes on BridgeTex pipeline seen up 16 pct this year -Magellan

HOUSTON (Reuters) - Magellan Midstream Partners LP expects crude volumes this year to increase 16 percent on the BridgeTex pipeline to accommodate shipments of more oil from the Permian Basin of West Texas and New Mexico, the largest U.S. oilfield, to exporters and refineries in the Houston Gulf Coast area, executives said.

The pipeline, which moves crude oil from Midland and Colorado City, Texas, to East Houston, Texas, is expected to average about 315,000 barrels-per-day (bpd), up from about 270,000 bpd all of last year, executives said on the company’s earning call on Thursday.

The pipeline was recently expanded from 300,000 bpd to a capacity of 400,000 bpd. Magellan is expanding the pipeline system again, for a new capacity of about 440,000 bpd, expected to be operational in early 2019.

The company recently set new committed shipping rates to move crude on the line after it completed a supplemental open season and secured additional volume commitments for the new expansion capacity.

BridgeTex is co-owned by Magellan and Plains All American Pipeline LP.

Meanwhile, flows on Magellan’s Longhorn pipeline, which ferries crude from Crane, Texas to Houston, are forecast to average 260,000 bpd, similar to 2017 levels.

However, existing term contracts are set to expire in the fourth quarter. Negotiations with customers regarding shipment rates are currently underway, said Chief Executive Michael Mears.

“We would err to recontract at rates that are secure for term commitments rather than be exposed to whatever the differential is at any point in time with spot tariffs,” he said. (Reporting by Bryan Sims; Editing by David Gregorio)


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Editorial Comment
-Adrienne Blume
This year could be the largest ever for LNG export project final investment decisions (FIDs).
EWAnalysis: Impact of technology on gas transmission management—Part 2
-Bob Andrew
This article is the second in our “Impact of Technology” series; the first was “Impact of technology in gas processing plants—Part 1,” which appeared in the October/November 2018 issue of Gas Processing & LNG.


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