Two more Texas energy firms think Oklahoma’s STACK is such a hot prospect, they’ve formed a joint venture to begin exploration there.
Houston-based midstream companies Plains All American Pipeline LP and Phillips 66 Partners LP have joined forces, with Phillips 66 Partners kicking in $50 million in cash for its 50 percent interest in the JV. The effort will also link to Cushing.
One published account quoted Plains Chairman and CEO Greg Armstrong calling the STACK “one of the most exciting emerging resource plays in North America.”
Plains threw in an existing terminal in Cashion and a 55-mile crude oil pipeline. The terminal has the capability of storing 200,000 barrels of crude oil and the pipeline has a capacity of nearly 100,000 barrels a day.
“We are pleased to announce this joint venture with Plains to develop a strategic transportation asset in the emerging STACK play,” said Greg Garland, Phillips 66 Partners chairman and CEO.
The JV will include $15 million for a truck station, a lateral pipeline to connection the station to the Cashion Terminal and another 100,000 barrels of storage at the terminal.
“The formation of the STACK joint venture is consistent with our growth strategy and will provide Phillips 66 Partners with a fee-based asset backed by third-party committed shipper volumes. The system’s connectivity to Cushing also will provide another source of advantaged crude to Phillips 66’s Ponca City Refinery.”
The JV is only the latest spotlight on the STACk located in Canadian, Kingfisher and Blaine Counties. Newfield Exploration recently sold all of its Texas holdings to focus on the STACK. Marathon Oil has taken similar steps by buying Oklahoma City-based PayRock Energy Holdings LLC. And 8 months ago, Oklahoma City’s Devon Energy made a $1.9 billion deal to buy 80,000 adres in the STACK from Felix Energy LLC.