Valero Energy Corp. (VLO: 18.14 -0.02 -0.11%) announced plans to double the size of its crude oil gathering system in the Texas and Oklahoma regions. The company plans to expand capacity of its McKee refinery in Sunray, Texas, which has a feedstock throughput of about 170,000 barrels per day currently.The start of operations at Valero’s McKee refinery dates back to 1933. The refinery had several major upgrades over the years. Situated in the heart of the Texas Panhandle, the McKee refinery has access to crude oil from northern Texas, Oklahoma, southwestern Kansas and eastern Colorado through an extensive network of crude oil pipelines, making it one of the most well-connected plants in Valero’s system.
Valero’s McKee project involves expanding pipelines in the Texas panhandle between Oklahoma and New Mexico and the Oklahoma panhandle between Texas and Kansas. The project also requires looping of the existing pipeline from a storage facility in Perryton, Texas, and adding pump stations and storage facilities.
Valero expects the project to be completed quickly since most of the infrastructure and right-of-way is already in place. The scheduled completion date for the project is by fourth quarter of 2010.
The project will enable the company to boost the volumes transported through its gathering system, serving more producers in the area. The project also makes room for Valero to accommodate increased crude production in the future.
The McKee refinery produces a wide variety of refined petroleum products including gasoline, jet fuel, diesel, asphalt, carbon black oil, sulfur, sulfuric acid and liquefied petroleum gas (LPG). It transports refined products through six main pipelines.
San Antonio, Texas-based Valero Energy Corporation is the largest independent refiner and marketer of petroleum products in the U.S., with a refining capacity of 2.8 million barrels per day in its 15 refineries located throughout the U.S., Canada and the Caribbean. Valero is also a leading ethanol producer with 10 ethanol plants in the Midwest with a combined capacity of 1.1 billion gallons per year.http://www.valero.com/default.aspx
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