Tulsa, OK, Houston, TX and The
Woodlands, TX - Magellan Midstream Partners (NYSE: MMP) (“Magellan”) and Plains
All American Pipeline, L.P. (NYSE: PAA) (“Plains”) announced today that a
wholly owned subsidiary of Anadarko Petroleum Corporation (NYSE:APC) has
exercised its option to purchase a 20% equity interest in Saddlehorn Pipeline
Company. As a result of today’s announcement, the equity ownership in
Saddlehorn will be 40% Magellan, 40% Plains and 20% Anadarko.
Saddlehorn is a limited liability
company that will construct, own and operate the Saddlehorn pipeline, an
approximately 550-mile pipeline that will transport various grades of crude oil
from the DJ Basin, and potentially the broader Rocky Mountain area resource
plays, to storage facilities in Cushing, OK owned by Magellan and Plains. The
20-inch pipeline will have an ultimate capacity to transport up to 400,000
barrels per day (bpd), but the initial capacity of the Saddlehorn pipeline is
expected to be closer to 200,000 bpd.
An extension to Carr, CO is also
under consideration for connection to existing crude oil assets owned by Plains
in that region. This lateral is being designed to provide additional shippers
with flexible options and streamlined access into the Saddlehorn system.
“Magellan and Plains are pleased to
have Anadarko as a partner in the Saddlehorn pipeline,” said Michael Mears,
Magellan’s Chief Executive Officer and Greg L. Armstrong, Chairman and CEO of
Plains All American. “Anadarko is a committed shipper and has a significant
production presence in this region, adding further value to the pipeline
project to deliver crude oil to the Cushing hub.”
The project is currently estimated
to cost between $800 million and $850 million. Magellan will serve as
construction manager and pipeline operator of the Saddlehorn system. Subject to
receipt of necessary permits and regulatory approvals, the Saddlehorn pipeline
is expected to be operational during mid-2016.
About Anadarko Petroleum Corporation
Anadarko
Petroleum Corporation's mission is to deliver a competitive and
sustainable rate of return to
shareholders by exploring for, acquiring and developing oil and natural gas
resources vital to the world's health and welfare. As of year-end 2014, the
company had approximately 2.86 billion barrels-equivalent of proved reserves,
making it one of the world's largest independent exploration and production
companies. For more information about Anadarko and APC Flash Feed updates,
please visit www.anadarko.com.
About Magellan Midstream Partners,
L.P.
Magellan Midstream Partners, L.P.
(NYSE: MMP) is a publicly traded partnership that primarily transports, stores
and distributes refined petroleum products and crude oil. Magellan owns the
longest refined petroleum products pipeline system in the country, with access
to nearly 50% of the nation’s refining capacity, and can store more than 95
million barrels of petroleum products such as gasoline, diesel fuel and crude
oil. More information is available at www.magellanlp.com.
About Plains All American Pipeline,
L.P.
Plains All American Pipeline, L.P.
(NYSE: PAA) is a publicly traded partnership that owns and operates midstream
energy infrastructure and provides logistics services for crude oil, natural
gas liquids (“NGL”), natural gas and refined products. Plains owns an extensive
network of pipeline transportation, terminalling, storage and gathering assets
in key crude oil and NGL producing basins and transportation corridors and at
major market hubs in the United States and Canada. On average, Plains handles
over 4.1 million barrels per day of crude oil and NGL on its pipelines. More
information is available at www.plainsallamerican.com.
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Portions
of this document constitute forward-looking statements as defined by federal law.
Although management of Anadarko Petroleum Corporation, Magellan Midstream
Partners, L.P. and Plains All American Pipeline, L.P. (the “companies”) believe
any such statements are based on reasonable assumptions, there is no assurance
that actual outcomes will not be materially different. Among the key risk
factors associated with the project that may have a direct impact on Saddlehorn’s
and the companies’ results of operations and financial condition are: (1) the
ability to obtain all required rights-of-way, permits and other governmental
approvals on a timely basis; (2) the ability to complete construction of the
project on time and at expected costs; (3) price fluctuations and overall
demand for crude oil; (4) changes in Saddlehorn’s tariff rates or other terms
imposed by state or federal regulatory agencies; (5) the occurrence of an
operational hazard or unforeseen interruption; (6) disruption in the debt and
equity markets that negatively impacts Saddlehorn’s or the companies’ abilities
to finance capital spending and (7) willingness to incur or failure of
customers or vendors to meet or continue contractual obligations related to the
project. Additional information about issues that could lead to material
changes in performance is contained in filings with the Securities and Exchange
Commission for all companies. The companies undertake no obligation to revise
these forward-looking statements to reflect events or circumstances occurring
after today's date.
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