ARCO TO EXPAND GULF COAST-OKLAHOMA LINE

March 5, 1990

ARCO Pipe Line Co., Independence, Kan., plans to increase capacity and flexibility of its crude oil pipeline from the Texas Gulf Coast to Cushing, Okla. The expansion program includes significant modifications in the Houston area. The company will boost capacity of the 50,000 b/d pipeline to 120,000 b/d by third quarter 1990 at a cost of about $48 million and eventually to 200,000 b/d as transportation needs develop. The Amerada Hess Corp. terminal on the Houston Ship Channel will remain an

ARCO Pipe Line Co., Independence, Kan., plans to increase capacity and flexibility of its crude oil pipeline from the Texas Gulf Coast to Cushing, Okla.

The expansion program includes significant modifications in the Houston area.

The company will boost capacity of the 50,000 b/d pipeline to 120,000 b/d by third quarter 1990 at a cost of about $48 million and eventually to 200,000 b/d as transportation needs develop.

The Amerada Hess Corp. terminal on the Houston Ship Channel will remain an origin point for the line.

ARCO will lay a pipeline across the channel to connect its Texas City marine terminal with the pipeline to Cushing. ARCO's terminal, with a capacity of nearly 1 million b/d, is capable of unloading two partially lightered 150,000 dwt tankers at the same time. The connection will allow shippers to deliver cargoes to Texas City and Houston area refineries as well as north on the pipeline for ultimate discharge at Midcontinent, Great Lakes, and U.S. Northeast refineries.

ARCO also plans to connect the Texas City-Cushing system with Texaco's Houston tank farm and Oiltanking Houston Inc.'s Houston terminal. The Houston area connections will enable refiners, crude oil marketers, and traders to split cargoes for multiple deliveries.

ARCO will build a tank farm and pump station on the north side of the channel to receive crude from the Houston connections and ship it to the Midcontinent and beyond.

Along the pipeline, ARCO will lay 20 in. pipe between Jacksboro, Tex., and Ringling, Okla., to debottleneck that segment, add pumping capacity at Files Valley and Jacksboro, Tex., and Ringling, Pool, and Pauls Valley, Okla., and add tanks to boost delivery capability at Jacksboro and Ringling.

Expansion is expected to increase the volume of water borne imported crude delivered to the Midcontinent and improve liquidity of the Cushing market in the face of declining U.S. crude oil production, ARCO said. The line has transported more than 17 million bbl of imported crude since start-up in March 1988.