Energy Transfer Partners joins with Phillips 66 for new Bakken crude pipelines

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Kelcy Warren, CEO of Energy Transfer Partners.

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Nicholas Sakelaris

Staff Writer- Dallas Business Journal

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Energy Transfer Partners announced a joint venture with Phillips 66 to build two pipelines to move crude oil out of North Dakota.

Dallas-based Energy Transfer Partners (NYSE: ETP) will have a 75-percent interest in the pipelines, which will link crude oil from the Bakken Shale and Three Forks formation to refineries and rail terminals.

Houston-based Phillips 66 (NYSE: PSX) will have a 25 percent interest and will pay a proportionate cost of the construction. Both pipelines are scheduled to be completed by the end of 2016.

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The Dakota Access Pipeline (DAPL) will deliver up to 570,000 barrels per day to Pakota, Illinois, where it will connect to the other new pipeline. The $3.7 billion pipeline will be 1,100 miles long, 30 inches in diameter and pass through four states.

The Energy Transfer Crude Oil Pipeline (ETCOP) will carry oil from Pakota to Nederland in South Texas. The 30-inch diameter pipeline has the capacity to carry up to 570,000 barrels per day of crude oil, nearly half the current production in the Bakken Shale.

The ETCOP pipeline is a total of 744 miles long and passes through seven states. The majority of the pipeline will actually be a converted natural gas pipeline.

"We look forward to working with Phillips 66 to build this much-needed pipeline infrastructure to link rapidly growing supplies of domestically produced light crude oil in the Bakken/Three Forks play to refineries throughout the country," said Kelcy Warren, CEO of Energy Transfer Partners.

The ETCOP pipeline will replace four to seven crude oil trains per day, relieving congestion on the railroads in the Midwest. The pipeline will create 800 construction jobs.

Nicholas covers the energy, manufacturing, aviation and transportation beats for the Dallas Business Journal. Subscribe the Energy Inc. newsletter