Cactus II pipeline’s open season has been successful with long-term contracts agreed for the 585,000 barrels per day pipeline which extends from the Permian Basin to the Corpus Christi/Ingleside area.

Cactus II pipeline capacity is fully committed with long-term third-party shipper contracts totalling 525,000 barrels per day, composed of 425,000 barrels per day of long-term minimum volume commitments and an additional 100,000 barrels per day of commitments associated with long-term acreage dedications.

Approximately 60,000 barrels per day is reserved for walk-up shippers. Affiliates of certain third-party contracted shippers have options to participate as joint venture partners for up to 35% of Cactus II. PAA is expected to retain 65% ownership and will serve as operator.

The Cactus II pipeline system will have origination points at Orla, Wink, Midland, Crane and McCamey, Texas and will be capable of transporting multiple quality segregations. The system includes a combination of capacity on existing pipelines and two new 26-inch pipelines and is expandable to approximately 670,000 barrels per day through the addition of incremental pumping capacity.

The first new pipeline will extend from Wink to McCamey, TX, and the second new pipeline will extend from McCamey to the Corpus Christi/Ingleside area, and have flexibility to access multiple docks.

The capital cost of the two new pipelines is expected to total approximately $1.1bn, with PAA’s portion representing approximately $700 to $750m, which amount was included in PAA’s capital plan disclosed earlier this month and assumes exercise of the third-party options to participate in the joint venture.

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1st Mar 2018

1st March 2018