May 8, 2018 / 11:10 PM / in 2 months

Pipeline firm Plains says Permian volumes grew in Q1, constraints appear

    NEW YORK, May 8 (Reuters) - Plains All American Pipeline LP
        said on its first quarter earnings call that Permian
crude oil transportation volumes grew about 750,000 barrels per
day in the quarter compared with a year earlier:
    
    * Production in the Permian basin is currently exceeding
expectations and a recent widening of Permian crude
differentials is a positive indicator for fee-based revenue on
Permian systems. 
    * "Our 2018 guidance incorporated an expectation that
Permian takeaway capacity would likely experience constraints in
the second half of 2018 and the first half of 2019 ... This is
materializing earlier than expected," a company executive said
during the call. 
    * The company is accelerating projects to address
constraints but says long-distance pipeline constraints will
likely remain until additional projects like Sunrise I and II
expansions and Cactus II are completed.
    * Somewhat limited margin upside from wide Permian
differentials expected over 2018 but if wide Permian
differentials remain for 2019, company expects to see improved
performance.
    * Plains also plans to construct the Cactus II crude line
with fully expanded capacity of 670,000 bpd and expects the 
line to begin service in Q4 2019 with throughput volumes ramping
up over a couple of quarters.
    * Sunrise extension and loop adds about 500,000 bpd of
capacity from Midland to Colorado city and Wichita falls;
project supported by producers.

 (Reporting by Devika Krishna Kumar in New York, Editing by
Rosalba O'Brien)
  
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