Sunoco Logistics Partners L.P. has announced a strategic joint venture with ExxonMobil in which the companies will form Permian Express Partners LLC to combine certain of their key crude oil logistics assets.
Sunoco Logistics will contribute its Permian Express 1, Permian Express 2 and Permian Longview and Louisiana Access pipelines. ExxonMobil will contribute: its Longview to Louisiana and Pegasus pipelines; Hawkins gathering system; an idle pipeline in southern Oklahoma; and its Patoka, Illinois, terminal.
This joint venture establishes a stronger crude oil logistics network to meet market demand, provides additional take-away opportunities for shippers, and expands ExxonMobil’s options to supply its network of refineries. Concurrent with the transaction, ExxonMobil and its affiliates will enter into a preferred provider agreement with the joint venture. Sunoco Logistics will be the majority owner and operator of the joint venture’s assets.
“This combination of certain strategic crude oil assets, together with our existing and recently acquired Midland Basin assets, greatly enhances our service capabilities for the Permian Basin, one of the most prolific shale areas with incredible growth opportunities. We expect to achieve significantly greater long-term accretion as domestic crude oil production grows over time," said Michael J. Hennigan, President and Chief Executive Officer of Sunoco Logistics.
Upon closing, ownership in Permian Express Partners LLC will be approximately 85% SXL and 15% XOM.
Read the article online at: https://www.worldpipelines.com/contracts-and-tenders/10112016/sunoco-and-exxonmobil-crude-joint-venture/