September 22, 2011 [Plains All American Pipeline] - Plains All American Pipeline, L.P., announced today that it is proceeding with its Phase IV expansion at the Partnership's St. James, Louisiana terminal facility.
This expansion will include construction of an additional 1.2 million barrels of crude oil storage capacity and is targeted to be completed in the third quarter of 2012 at a cost of approximately $50 million. The project is supported by multi-year contracts and throughput arrangements with third-party customers and is part of the Partnership’s ongoing program to increase its cash flow contributions from fee based activities.
The Partnership also provided comments with respect to its adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the third quarter of 2011. “All three of our business segments continue to perform well. As a result of strong fundamentals, generally favorable market conditions and solid execution in our supply and logistics segment, we are meaningfully outperforming our guidance estimates,” said Greg L. Armstrong, PAA’s Chairman and CEO. “Third-quarter results for the transportation segment will also benefit from the re-start of the Rainbow pipeline in late August. As a result, we currently expect our adjusted EBITDA will likely exceed the midpoint of our guidance range for the third quarter of 2011 by as much as 20% to 25%.” In connection with its second quarter conference call on August 4, 2011, the Partnership provided a guidance range for adjusted EBITDA for the third quarter of 2011 of $310 million to $340 million.
The St. James expansion represents PAA’s third facility expansion since its original completion in 2007, and will bring total storage capacity at St. James to 8.3 million barrels. The St. James facility has a manifold and header system designed to allow receipts and deliveries with connecting pipelines at their maximum operating capacity. Located adjacent to the Mississippi river, the St. James facility also contains a barge and ship dock, which receives crude oil and condensate from ships and inter-coastal barges. Additionally, the dock will be capable of loading barges near the end of 2011. The St. James facility is also directly connected with a crude oil rail terminal that has a current capacity to offload approximately 65,000 barrels per day, which will double to 130,000 barrels per day by the fourth quarter of 2011.
PAA owns and operates a network of approximately 16,000 miles of liquids pipelines, approximately 90 million barrels of liquids storage capacity and handles over 3 million barrels of physical product on a daily basis.
