Phillips 66 Partners increase pipeline investments

Phillips 66 Partners is set to purchase shares of three pipeline systems from parent company Phillips 66, totalling $1.01 billion.

The agreement involves equity interest in the Sand Hills and Southern Hills natural gas liquids (NGL) pipelines (33 percent, each) and the Explorer Pipeline Company (19.5 percent). Both NGL pipelines terminate on the Gulf Coast of Texas, while the Explorer pipeline sends refined products from Gulf facilities to the US Midwest.

Payment will be made via $880 million in cash and 1.7 million units of newly issued Phillips 66 Partners stock. Phillips 66 Partners’ board of directors has approved the terms of the deal, expected to close in early March.

“This acquisition will expand our fee-based portfolio into NGL transportation and provide us with an interest in one of the largest refined products pipeline systems in the US,” the Oil & Gas Journal quoted Greg Garland, Phillips 66 Partners chairman and CEO as saying.