Headquartered in Houston, Texas, Phillips 66 Partners (NYSE: PSXP) is a growth-oriented traditional master limited partnership formed by Phillips 66 to own, operate, develop and acquire primarily fee-based crude oil, refined petroleum product and natural gas liquids (“NGL”) pipelines and terminals and other transportation and midstream assets.
Phillips 66 Partners and Paradigm Midstream, LLC (“Paradigm”) have formed Joint Ventures to develop assets in the Bakken Shale. The Sacagawea Pipeline, the Blue Buttes Gas Pipeline, and the Keene CDP have all been developed under the Pipeline JV and the Palermo Rail Terminal has been developed under a Rail JV. These JV’s enhance logistical options for crude oil and gas transportation, storage and processing in the Bakken region.
The Pipeline JV, which is owned by Paradigm and Phillips 66 Partners, has created two joint ventures:
- Sacagawea Pipeline Company, LLC, a partnership between the Pipeline JV and Grey Wolf Midstream, owns the Sacagawea Pipeline and the Blue Buttes Gas Pipeline.
- Paradigm Midstream Services – SC, wholly owned by the Pipeline JV, owns the Keene CDP and the Palermo Terminal.
The Sacagawea Pipeline Company, LLC has constructed and operates the bi-directional Sacagawea Pipeline consisting of 94 miles of 16” crude oil pipeline with a capacity of up to 200MBbl/d. The pipeline utilizes a difficult to replace pipe crossing beneath Lake Sakakawea and transports crude oil between Mountrail and McKenzie Counties. The Sacagawea Pipeline has origination points at the Keene CDP, Johnson’s Corner (DAPL), and New Town, and delivers into Johnson’s Corner (DAPL), the Keene CDP, Stanley (NDPL), and the BNSF Palermo Rail Facility. Constructed by Paradigm, Phillips 66 Partners operates the system
Blue Buttes Gas Pipeline
The Blue Buttes Gas Pipeline includes 24 miles of 16” pipeline with an initial capacity of 150+MMcf/d. Connected to the Blue Buttes Pipeline is the Sanish compressor station, which has a 40MMcf/d capacity, with the ability to expand. The pipeline links production on both sides of Lake Sakakawea, transporting Raw Natural Gas between Mountrail and McKenzie Counties for processing.
Keene and Palermo CDP
Paradigm JV has built the Keene CDP, a 272 acre Central Delivery Point located 4.5 miles north of Johnson’s Corner in McKenzie County, North Dakota. The facility currently has:
- 490 MBbl of crude storage at Keene CDP (permitted for 1.2 MBbl)
- 220 MBbl of crude storage at Palermo CDP
- (6) Truck Lanes (expandable up to 12 lanes)
- Outbound Connectivity: Sacagawea North (into NDPL at Stanley and Palermo Rail), Sacagawea South (into DAPL at Johnson’s Corner), Four Bears, Tesoro
Palermo Rail Terminal
The Rail JV project consists of a crude oil rail-loading terminal located on a 710-acre site near Palermo, North Dakota. The BNSF Palermo Rail Terminal has an existing capacity of 100,000 barrels per day, which supports rail transport of up to one unit train per day, and is capable of expanding up to 200,000 barrels and two unit trains per day. It is located on a railway main line with two mainline switches, allowing east-and west-bound rail traffic. The terminal includes a pipeline delivery and receipt connection to the Sacagawea Pipeline, allowing the terminal to receive crude oil from areas in Mountrail and McKenzie Counties, North Dakota for delivery into premium markets across the US.
The terminal also includes 6 truck offload lanes, expandable up to 12 truck lanes and approximately 300,000 barrels of operational storage, with permits allowing for total storage capacity of up to 2.4 million barrels.
Phillips 66 Partners operates the Keene CDP, Sacagawea Pipeline, and Palermo Rail Terminal. Paradigm Midstream operates the Blue Buttes Gas Pipeline.