Energy downstream operator
Western Refining Inc.
) declared start up of the first phase of its Delaware Basin
Crude Oil Gathering System. The Mason Station Crude Oil Terminal
is located in Reeves County, Texas and is owned and operated by a
subsidiary of WNR.
The Mason Station comprises crude oil storage and truck
offloading stations. It also includes a pipeline link to El Paso
crude oil pipeline of
Kinder Morgan Energy Partners L.P.
) - the largest independent owner and operator of petroleum
product pipelines in the U.S.
The second phase of WNR's Delaware Basin System is slated for
completion in second quarter 2013. It includes 50 miles of crude
oil gathering lines in Southern New Mexico and West Texas. Upon
completion, both the phases can together deliver up to 100,000
barrels per day (bpd) of shale crude oil to Kinder Morgan's crude
oil pipeline. The present capacity of the pipeline is 25,000 bpd.
WNR is also evaluating the viability of the third and fourth
phases of the Delaware Basin System. The third phase will connect
to WNRs' 16" TexNew Mex pipeline in Chaves County, New Mexico.
This link will enable extra supply flexibility for shale crude
oil to its El Paso, Texas and Gallup, New Mexico refineries.
Phase four includes the expansion of WNRs' rail capabilities at
its Gallup refinery. At present, the Gallup refinery can load six
tanker rail cars per day which could be extended to 20 tanker
rail cars per day.
WNR plans to release its first quarter 2013 results on May 2,
2013, before the opening bell. With the success of the current
project, WNR is on an expansion path. It looks forward to more
such opportunistic programs in the coming years. We believe such
accomplishments will garner profits for WNR in the upcoming
WNR currently retains a Zacks Rank #3 (Hold), implying that it is
expected to perform in line with the broader U.S. equity market
over the next one to three months.
Meanwhile, there are other oil refining and marketing firms in
the energy sector that are performing better and are worth
considering at the current level. These include
Calumet Specialty Products Partners L.P.
NGL Energy Partners L.P.
). Both these stocks sport a Zacks Rank #1(Strong Buy).
CALUMET SPECLTY (CLMT): Free Stock Analysis
KINDER MORG ENG (KMP): Free Stock Analysis
NGL ENERGY PART (NGL): Free Stock Analysis
WESTERN REFING (WNR): Free Stock Analysis
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