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Capline tests market for crude line reversal

17 Oct 2017, 1.40 pm GMT

Capline tests market for crude line reversal

Houston, 17 October (Argus) — The 1.2mn b/d Capline crude pipeline launched a nonbinding open season today to "gauge interest" in a long-discussed reversal, which would send onshore crude from Patoka, Illinois, to the existing origin at St James, Louisiana.

The open season will run through 17 November. If owners Plains All American Pipeline, Marathon Petroleum and BP decide to move forward, the reversal could be operational in the second half of 2022 at an initial capacity of 300,000 b/d.

Marathon, the operator, noted in a press release that demand to ship crude in the current northbound configuration has waned in recent years because of "various market factors", chiefly the surge in onshore crude production from shale basins and Canadian oil sands operations.

One of the last major consistent customers on Capline, Valero's 190,000 b/d Memphis, Tennessee, refinery, is expected to begin relying on Plains' 200,000 b/d Diamond pipeline out of Cushing, Oklahoma, late this year or early 2018.

While the Seaway and Marketlink systems out of Cushing and Energy Transfer Partners' Bakken system out of Patoka can bring midcontinent crude to the Texas coast, there is no direct pipeline link for that crude to the eastern Louisiana refinery and storage complex.

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