Magellan Midstream, Occidental Start BridgeTex Operation
Tulsa, OK-based publicly traded energy pipeline partnership, Magellan Midstream Partners LP (MMP) and oil and gas exploration and production company, Occidental Petroleum Corp. (OXY) declared that their jointly owned BridgeTex Pipeline has started commercial operation.
The pipeline is supplying crude oil to the Houston Gulf Coast area from the Permian Basin of west Texas. According to Magellan Midstream, the maximum transportation capacity of the pipeline is 300,000 barrels per day.
The construction of the BridgeTex Pipeline started on Nov 2012, after the project secured long-term commitments from the shippers during the open season.
Tulsa, OK-based Magellan Midstream is a master limited partnership (MLP) that owns and operates a diversified portfolio of energy infrastructure assets. The partnership primarily transports, stores, and distributes refined petroleum products and, to a lesser extent, ammonia.
Magellan Midstream, which is ahead of its peer Sunoco Logistics Partners LP (SXL) in terms of market capitalization, owns an attractive portfolio of energy infrastructure assets that generate stable and recurring fee and tariff-based revenues. The partnership’s expansion plans, a sound liquidity position and strong track of distribution growth are other positives.
Moreover, we remain upbeat regarding Magellan’s acquisition of petroleum storage and pipelines from a subsidiary of BP plc (BP). Following the acquisition, Magellan owns one of the largest crude oil storages in the Cushing crude oil region and will continue to exploit opportunities necessary to improve the utilization of these assets.
On the other hand, Los Angeles, CA-based Occidental Petroleum is an integrated oil and gas company, with significant exploration and production exposure. The company’s steady progress in growth projects, along with simultaneous strategic asset divestment, should help in improving its future performance.
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