Magellan Midstream Partners LP (NYSE:MMP) (Tulsa, Oklahoma) expects capital expenditures for projects under way this year to be $850 million. This includes a newly announced marine terminal along the Houston Ship Channel in Texas, and a soon-to-be completed condensate splitter in Corpus Christi.

The planned 1 million-barrel refined products and ethanol storage facility in Pasadena, Texas, has a $335 million price tag. It would include a marine dock capable of handling Panamax-sized ships or barges with a draft of up to 40 feet. Magellan said it also will construct a 36-inch pipeline between its Galena Park, Texas, terminal and the new Pasadena terminal.

Magellan Chief Executive Officer Mike Mears said negotiations are still ongoing on the proposed Pasadena terminal, but added the project could begin to turn dirt in nine months, with completion in in 2019. Mears said during the company's earnings conference call the facility could eventually be expanded to store up to 10 million barrels, with a total price tag of $1 billion. He said the price of each expansion would be less than the original grassroot build.

Also, Mears said he expects the 50,000-barrel-per-day (BBL/d) Corpus Christi condensate splitter to be commissioned next month and commercially operational late in the fourth quarter of 2016, with a total project cost of about $300 million. It would operate under a take-or-pay agreement with Trafigura Beheer BV (Geneva, Switzerland), a commodities trading company.

Prior to the U.S. lifting its ban on crude oil exports (which also included condensate), condensate splitters were thought of as a means to turn condensate as saleable products (diesel, kerosene and naphtha) for export. Magellan maintains that even with the recent lifting of the export ban, splitters are important infrastructure to separate condensate into usable components to meet global demand. For related information, see April 6, 2016, article - Magellan Midstream: Key Projects in Line for Completion this Year.

Industrial Info is tracking $1.64 billion in active Magellan Midstream projects. Magellan Midstream reported net income of $187.9 million for second-quarter 2016, compared with $177.4 million for second quarter 2015.

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