Phillips 66 Partners has released a statement that they have received enough commitments on the Gray Oak Pipeline System to justify moving forward with development. The Pipeline will run from receipt points in West Texas to destinations in Corpus Christi and the Sweeny/Freeport area. Once it reaches Corpus, Gray Oak will deliver crude into the newly announced South Texas Gateway Terminal. This new terminal is a joint venture between Buckeye, P66 and Andeavor and it will initially consist of 3.4 million barrels of storage and two berths which will be able to handle VLCC's.

Gray Oak Pipeline Details

Origination stations will be spread throughout Reeves, Loving, Winkler, and Crane counties in West Texas and in the Eagle Ford region. Commercial service will begin in late-2019. The initial pipeline design will handle up to 385 Mbbl/d but it may be larger depending on how the next open season goes.

With regards to the second open season, Phillips 66 stated that, depending on results, the pipeline could carry up to 700 Mbbl/d to downstream markets with ultimate expansions of up to 1 MMbbl/d. The second open season will begin April 26, 2018.

South Texas Gateway Terminal Details

The South Texas Gateway Terminal will be on a 212 acre parcel of land in Corpus and will serve as the main outlet for crude oil from the potentially 700-1,000 Mbbl/d Gray Oak Crude OIl Pipeline.

The initial terminal will consist of 3.4 MMbbl in crude oil storage, two deep-water docks with VLCC berthing capability and it can be expanded up to 10 MMbbl with more docks in the future. Commercial operations will commence by year-end 2019. Buckeye will own 50% of the JV, with P66 and Andeavor each holding another 25%.