DCP Midstream LLC (DCP) and Occidental Petroleum Corporation (Oxy) announced today that they have entered into preliminary agreements for Oxy's wholly owned subsidiary Occidental Chemical Corporation (OxyChem) to provide right-of-way for the DCP Midstream Sandhills Pipeline LLC (Sandhills Pipeline) and for DCP to provide a supply option for a proposed new Oxy NGL fractionator in Ingleside, Texas.
"We are very excited to work with Oxy to secure key right-of-way for the Sandhills Pipeline and to potentially provide a reliable, long-term NGL supply to Oxy's proposed fractionator," said Bill Waldheim, president of DCP's northern business unit. "This is just one example of how the Sandhills Pipeline can provide reliable supply to key fractionation consumers along the Gulf Coast."
The agreement with OxyChem will provide the Sandhills Pipeline with approximately 14 miles of right-of-way and key access to the Mont Belvieu, Texas, fractionation complex. It also will help keep the Sandhills Pipeline project on track for a first half of 2013 start-up.
DCP Midstream is in the process of securing the remaining right-of-way and environmental permits for the Sandhills Pipeline. The new 700-mile pipeline system will transport Y-grade natural gas liquids (NGLs) from gas plants in the Permian Basin and South Texas to the various fractionator facilities along the Gulf Coast, along with the Mont Belvieu NGL hub.
The Sandhills Pipeline will serve the NGL transportation needs of gas processing plants in West Texas and South Texas, including DCP gas plants and the new 200 million cubic feet per day (MMcf/d) DCP Eagle gas plant designed to serve Eagle Ford shale gas development. In addition, DCP Midstream is securing long-term commitments from other third-party shippers.
DCP Midstream, LLC, headquartered in Denver, Colorado, leads the midstream segment as one of the nation's top three largest natural gas gatherers and processors, and the largest natural gas liquids producer and one of the largest marketers in the U.S. DCP Midstream operates in 18 states across producing regions. DCP Midstream is a 50:50 joint venture between Spectra Energy and ConocoPhillips. The Company owns the General Partner of DCP Midstream Partners, LP, a master limited partnership, and provides operational and administrative support to the partnership. For more information, visit the DCP Midstream, LLC website at www.dcpmidstream.com.
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Lisa Newkirk, 303-605-1837