$PAA Plains All American Pipeline (NYSE:PAA) says it received sufficient binding commitments on its initial open season and will proceed with construction of the Cactus II pipeline system connecting the Permian Basin to Corpus Christi, Tex.
The Cactus II system would add two pipelines to PAA's existing Cactus network, expanding crude capacity to as much as 585K bbl/day from 390K bbl/day currently; PAA hopes to complete the project by Q3 2019.
PAA says it also received sufficient customer interest to conduct a second binding open season related to Cactus II.
$PAA U.S. WTI crude oil surpasses $65/bbl for the first time since December 2014 before pulling back slightly, after data showed the 10th straight weekly drop in U.S. crude stockpiles.
WTI reached a high of $65.42/bbl, with its discount to Brent narrowing to $5/bbl vs. ~$6.50 at the beginning of the year; Brent also hits a new three-year high, climbing to $70.43/bbl.
The 1.07M-barrel U.S. drawdown was led by a 3.15M-barrel drop at the Cushing, Okla., storage hub, with traders citing a ramp-up in volumes on Plains All American's (PAA +0.4%) 200K bbl/day Diamond pipeline from Cushing to Memphis, Tenn.
Cushing stocks have fallen by more than 12M barrels over the past four weeks to 39.24M barrels and are now 40% lower than a year ago.
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