08-01-2013

Phillips 66 and Global Partners sign long-term crude transportation and logistics contract

Phillips 66 today announced that it has signed a five-year contract with Global Partners LP under which Global will use its rail transloading, logistics and transportation system to deliver crude oil from the Bakken region of North Dakota to the Phillips 66 Bayway refinery in New Jersey. This is one of several commitments to transportation infrastructure Phillips 66 has made that tie directly to its strategy of delivering advantaged crude oil to the company’s U.S. refineries.

The terms of the contract include a take-or-pay commitment from Phillips 66 to receive approximately 91 million barrels of crude oil over the contract term, which equates to approximately 50,000 barrels per day. 

“Global has established a ‘virtual pipeline’ for the reliable transportation of Bakken crude,” said Tim Taylor, Executive Vice President, Commercial, Marketing, Transportation & Business Development of Phillips 66. “Our five-year agreement with Global assures us long-term access to advantaged crude for our Bayway refinery through what we believe is a cost competitive origin-to-destination supply system to the East Coast.”

“We are proud to partner with one of the world’s leading independent downstream energy companies,” said Eric Slifka, President and CEO of Global Partners. “Phillips 66 and its predecessor have been long-standing strategic business partners with Global for more than 15 years in the refined products market.”

The contract will utilize Global’s network of loading facilities and offloading terminals. Phillips 66 is one of the first energy companies to move shale crude to the East Coast. Last year, the company expanded its capability to deliver shale crude to its refineries by truck, rail, barge, ocean going vessels, and pipeline.