Plains All American Pipeline, L.P. announced plans to convert an existing Oklahoma LPG pipeline into crude oil service.
The pipeline, which extends from Medford, OK to PAA’s crude oil terminal facility in Cushing, will provide an initial crude oil throughput capacity of 12,000 bpd and will be expanded to 25,000 bpd by July 2012.
In other news, Plains All American Pipeline’s wholly owned subsidiary, Plains Midstream Canada ULC, has entered into a definitive agreement with BP to acquire BP’s Canadian NGL and LPG business for total consideration of $1.67 billion. Assets to be acquired include ownership interests of varying levels in and contractual rights relating to 2,600 miles of pipelines, 20 MMbbls of LPG storage capacity, seven fractionation plants with 232,000 bod of capacity, multiple straddle plants and two field gas processing plants with an aggregate capacity of 8 Bcf/d, as well as 10 MMbbls of long-term and seasonal NGL inventory as of Oct. 1. The business also includes various supply contracts at other field gas processing plants, shipping arrangements on third-party NGL pipelines and long-term leases on 720 rail cars used to move product among various locations.