Plains All American's Cactus II pipeline fully committed
Plains All American announced the conclusion of the recent open season for its Cactus II pipeline, a new pipeline system with an initial capacity of 585,000 barrels per day extending from the Permian Basin to the Corpus Christi/Ingleside area. Cactus II pipeline capacity is fully committed with long-term third-party shipper contracts totaling 525,000 barrels per day, composed of 425,000 barrels per day of long-term minimum volume commitments and an additional 100,000 barrels per day of commitments associated with long-term acreage dedications. Approximately 60,000 barrels per day is reserved for walk-up shippers. Affiliates of certain third-party contracted shippers have options to participate as joint venture partners for up to 35% of Cactus II. PAA is expected to retain 65% ownership and will serve as operator. The system is expandable to approximately 670,000 barrels per day through the addition of incremental pumping capacity. The capital cost of the two new pipelines is expected to total approximately $1.1B, with PAA's portion representing approximately $700M-$750M. Permitting, right-of-way and procurement activities are underway, and the pipeline system is targeted to be operational in 3Q19.