Phillips 66 will build two new NGL fractionators and add storage capacity and pipeline infrastructure at its Sweeny, Texas, hub by late 2020, the company said Wednesday.
The project, estimated to cost up to $1.5 billion, will add two 150,000 b/d fractionators in Old Ocean, Texas, and increase storage capacity by 6 million barrels, according to a company statement.
Phillips' Sweeny hub currently has one 100,000 b/d fractionator, 9 million barrels of NGL storage capacity at Clemens Caverns and the ability to export 200,000 b/d of LPG from its Freeport, Texas, terminal.
The company joins Enterprise and Lone Star in a recent push to add fractionation capacity on the Gulf Coast.
Lone Star is expected to add two 120,000 b/d fractionators at its Mont Belvieu, Texas, facility -- one in the third quarter of 2018 and another in mid-2019 -- bringing its total to six fractionators.
Enterprise's ninth fractionator at its Mont Belvieu facility, an 85,000 b/d unit, was expected to be online in June. The company reported an emissions event to state regulators in early May due to commissioning activities. It is unclear if the unit is running at full rates.
Market sources have attributed some of ethane's recent strength to insufficient fractionator capacity in Mont Belvieu.
The Mariner East 1 pipeline outage and "continued strong demand without the adequate infrastructure to deliver purities, I think, is driving it," a trader said in late May. "By infrastructure, I mean fracs."
June non-LST ethane was trading at 33 cents/gal Wednesday morning, a four-year high.
