Oil Pipeline Construction Project Begins in Delaware Basin

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Magellan Midstream Partners, L.P. has started construction of a new Delaware Basin pipeline originating in Wink, Texas to handle crude oil and condensate.

The 60-mile, 24-inch pipeline will have an initial capacity of 250,000 bpd with the ability to expand to more than 600,000 bpd, if warranted. The project also consists of the construction of a new terminal at Wink, which will offer broad inbound and outbound pipeline access to parties that connect to the facility.

The new pipeline segment will offer direct service from the Delaware Basin to the Crane origin of Magellan’s Longhorn pipeline, which provides crude oil and condensate transportation service to the Houston and Texas City refining complex and marine export facilities. In addition, this pipeline segment will be able to provide service from the Delaware Basin to the new crude oil and condensate line to Corpus Christi, Texas proposed by Magellan and others in the industry.

The project is expected to cost approximately $150 million and be operational in mid 2019, subject to receipt of any necessary permits and regulatory approvals.

Magellan plans to conduct an open season for commitments on the new pipeline system at a later time, but, construction of the new pipeline does not depend on the results of the open season. In addition, the company is assessing additional pipeline and terminal investments in West Texas to strengthen and enhance its overall crude oil service offerings.

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