Phillips 66 Partners Snags Liberty Pipeline Interest
Phillips 66 Partners LP plans to acquire a 50% interest in the Liberty Pipeline project from Phillips 66 for approximately US$75 million. Phillips 66 Partners will fund the transaction through a combination of cash and its revolving credit facility.
The cost of the pipeline is expected to be about US$1.6 billion, on a gross basis, or US$800 million net to the partnership. The purchase price reflects the reimbursement of project costs incurred by Phillips 66 prior to the effective date of the transaction.
Closing is expected on the 2nd March 2020, with an effective date of the 1st March 2020.
“The Liberty Pipeline is a great addition to the Phillips 66 Partners portfolio,” Greg Garland, Phillips 66 Partners’ chairman and CEO, said in a written statement.
“It is a strong organic project and continues our strategy of growing PSXP with stable fee-based cash flows, supported by long-term volume commitments. Phillips 66 Partners is well positioned to execute this pipeline project on the heels of successfully starting up the Gray Oak Pipeline.”
The 24-inch Liberty Pipeline will provide oil transportation service from the Rockies and Bakken production areas to Cushing, Oklahoma.
Service on the pipeline is expected to start in the first half of 2021.
Phillips 66 Partners is a master limited partnership formed by Phillips 66 to own, operate, develop and acquire oil, refined petroleum products and natural gas liquids pipelines, terminals and other midstream assets.