Phillips 66 announces 2023 capital programme

“The 2023 capital programme reflects our ongoing commitment to capital discipline,” said Mark Lashier, President and CEO of Phillips 66. “Through our Business Transformation, we are capturing US$200 million of sustaining capital efficiencies while prioritising safety and reliability. We are also investing in returns-focused growth opportunities, including enhancing our NGL platform and converting our Rodeo facility to produce lower-carbon renewable fuels. Additionally, the capital programme supports our commitment to return US$10 billion to US$12 billion to shareholders between the second half of 2022 and the end of 2024 through a secure, competitive, and growing dividend and share repurchases.”

The midstream capital plan of US$639 million comprises US$329 million for sustaining projects and US$310 million for growth projects. Growth capital will be directed toward enhancing the company’s integrated NGL value chain from wellhead to market. The midstream expected spend includes 100% of DCP Midstream, LP’s sustaining capital of US$150 million and US$125 million of growth capital.

In refining, Phillips 66 plans to invest US$1.1 billion, including US$389 million for reliability, safety and environmental projects. Refining growth capital of US$729 million includes the continuing conversion of the San Francisco Refinery in Rodeo, California, into one of the world’s largest renewable fuels facilities. The conversion will reduce emissions from the facility and produce lower carbon-intensity transportation fuels. Refining growth capital will also support opportunities for high-return, low-capital projects to improve asset reliability and market capture.

The marketing and specialties capital plan reflects the continued development and enhancement of the company’s retail network, including energy transition opportunities. Corporate and other capital will primarily fund digital transformation and information technology projects. Phillips 66’s proportionate share of capital spending by joint ventures (JVs) Chevron Phillips Chemical Company LLC (CPChem) and WRB Refining LP (WRB) is expected to total US$1.1 billion and be self-funded.

CPChem’s growth capital will fund construction of an integrated polymers facility on the US Gulf Coast. The facility, expected to begin operations in 2026, will include a 4600 million pounds per year ethane cracker and two 2200 million pounds per year high-density polyethylene units. CPChem continues expansion of its propylene splitting capacity and normal alpha olefins production, as well as other optimisation and debottleneck opportunities. In addition, CPChem will continue development of a world-scale petrochemical project in Ras Laffan, Qatar, with a final investment decision expected in early 2023.

WRB’s capital spending will be directed to sustaining projects, crude flexibility and enhancing clean product yield. Including Phillips 66’s proportionate share of capital spending associated with JVs CPChem and WRB, the company’s total 2023 capital programme is projected to be US$3.1 billion.

Read the article online at: https://www.worldpipelines.com/business-news/12122022/phillips-66-announces-2023-capital-programme/