Energy pipelines and terminals operator, Sunoco Logistics Partners LP (SXL), declared that it will start a binding open season for the Delaware Basin Extension project. The open season is meant for shippers willing to transport crude from the rapidly developing Delaware Basin area – comprising large oil fields − in New Mexico and West Texas to Midland, Texas. The open season will likely start on Oct 15, 2014.
The Delaware Basin Extension project – which is expected to start operation by the first half of 2016 − will consist of a new pipeline stretching roughly 125 miles. The pipeline is anticipated to initially transport crude at a rate of 100,000 barrels per day.
Sunoco Logistics Partners added that the shippers willing to make long-term volume commitments will be offered attractive rates.
Philadelphia-based master limited partnership (MLP), Sunoco Logistics Partners acquires, owns, and operates a geographically diverse portfolio of refined product and crude oil pipelines and terminal facilities. Its facilities are located across 17 states in the Northeast, the Midwest, the Southeast and the Southwest of the country.
With its low-risk and stable cash flow-generating energy infrastructure assets, Sunoco Logistics offers investors an opportunity to capture income growth through steadily-rising cash distributions and capital appreciation.
As a result, Sunoco Logistics Partners currently carries a Zacks Rank #2 (Buy), implying that it will outperform the broader U.S. equity market over the next one to three months.
One can also consider players in the oil and gas pipeline MLP sector like Delek Logistics Partners LP (DKL), Enbridge Energy Management LLC (EEQ) and EnLink Midstream Partners LP (ENLK), all of which sport a Zacks Rank #1 (Strong Buy).
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