Tulsa-based Magellan Midstream Partners, L.P. has successfully completed a $200 million, 210-mile Arkansas pipeline extension project connected to refineries in Oklahoma, Kansas and the Gulf Coast, according to a Journal Record report.
“There are periods of time during the year when (those) refineries produce the lowest-cost gasoline in the region, and so now they’ll have access to this market to bring in lower-priced fuel for central Arkansas,” said Michael Mears, Magellan’s President and CEO.
At a recent news conference in North Little Rock, state and company officials said the Midwest pipeline expansion from Fort Smith to Little Rock will bring up to 75,000 barrels a day of gasoline, diesel and jet fuel into Arkansas.
“It increases the reliability, the affordability, of the supply of energy and gas to central Arkansas,” said Gov. Asa Hutchinson. “This increases our supply and our capacity to grow. It is absolutely essential.”
The new pipeline makes use of the Ozark Abandonment Project, a 159-mile former natural gas line refitted for carrying petroleum products through the Arkansas River valley. The former natural gas pipeline is being leased by Magellan from Houston’s Spectra Energy Corp.
Next year, Magellan has plans to use the pipeline to supply jet fuel for Little Rock Airport and Little Rock Air Force Base.
The company also signed an agreement with Houston’s Enterprise Products to extend the Magellan pipeline into West Memphis, sparking a rivalry with Diamond Pipeline LLC which announced construction earlier this week on a new competing pipeline from Cushing, Oklahoma to Memphis, Tennessee.
“It’s going to take a year or nine months to build that connection, but we’ll be extending the benefits of this pipeline to West Memphis and the east Arkansas market,” said Mears.