Phillips 66 eyes West Texas Permian for new crude pipeline

By Luke Geiver | March 22, 2017

By the second half of 2018, Phillips 66’s Rodeo Project could be in full swing. The refining and logistics giant announced plans this week for a West Texas crude oil pipeline system it hopes to build in the Delaware Basin. The company has now commenced an open season call to gain shipper commitments in the Reeves, and Odessa, Texas, areas.

The Rodeo project will include a pipeline system for crude oil transportation for producers and other shippers in the area, including origination stations in Reeves, Loving and Winkler Counties. A new terminal will be built near Odessa and at Midland, Texas.

According to Phillips 66, the pipeline will initially move up to 130,000 barrels of oil per day, with an ultimate capacity possibility of 450,000 bpd, depending on the feedback the company receives during the open season call.

Through the open season process, Phillips 66 will include options for shippers to obtain committed shipper status through either an acreage dedication or a transportation and deficiency commitment.

Pipeline deals and construction announcements have been increasing in the region of West Texas since the start of the year. A 50,000 bpd refinery has also been proposed in the middle of the Permian Basin.