WASHINGTON (dpa-AFX) - Newfield Exploration Co. (NFX) Wednesday announced a crude oil supply agreement with HollyFrontier Corporation (HFC) to provide 20,000 barrels per day of supply capacity at HollyFrontier's Woods Cross, Utah, refinery. The new agreement spans a 10-year period with commitments commencing in 2014.
This is the second of two recent agreements by Newfield to secure approximately 40,000 BOPD of capacity for its planned oil growth in the Uinta Basin. The oil price differential associated with this agreement is not materially different than Newfield's current supply contracts in the basin.
Lee Boothby, Newfield's chairman, president and CEO, said,' This new agreement with HollyFrontier helps ensure that our oil growth will be matched by capacity expansions in the Uinta Basin.'
The company expects to run at least eight rigs in the Uinta Basin in 2012, up from a historic five-rig program.
Separately, HollyFrontier said the expansion of capacity at its Woods Cross refinery includes the relocation / revamp of crude, fluid catalytic cracking, and polymerization units from a subsidiary of Western Refining Inc.'s (WNR) Bloomfield, NM refinery to Woods Cross. The agreement with Newfield was in conjunction with the expansion at Woods Cross.
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