Calumet lets contract for Eagle Ford crude line construction

Calumet Specialty Products Partners LP’s wholly owned subsidiary Calumet San Antonio Refining LLC has signed TexStar Midstream Logistics LP to build, own, and operate a 30,000 b/d crude oil pipeline system that will supply at least 10,000 b/d of Eagle Ford shale crude oil to Calumet's San Antonio, Tex., refinery.

Under the 15-year agreement, TexStar will install and operate the Karnes North Pipeline System (KNPS), an 8-in. OD, 50-mile pipeline that will move crude from Karnes City, Tex., to Calumet’s Elmendorf, Tex., terminal, a supply hub for the San Antonio refinery. Calumet expects the pipeline to enter service fourth-quarter 2014. Calumet currently receives crude oil at its San Antonio refinery by truck.

The company earlier this quarter completed a project allowing the San Antonio refinery to blend heavy reformates, light naphtha, and ethanol to produce up to 3,000 b/d of finished gasoline, having previously produced ultralow-sulfur diesel, jet fuel, specialty solvents, reformates, naphtha, and vacuum gas oil. It expects early in first-quarter 2014 to complete a crude unit expansion at the San Antonio refinery, increasing total capacity to 17,500 b/d from 14,500 b/d, and boosting production of jet fuel, diesel fuel, and gasoline.

Calumet bought the refinery in December last year from NuStar Energy LP. NuStar had the previous month purchased crude oil pipeline, gathering, storage, and NGL assets in the Eagle Ford shale from TexStar (OGJ Online, Nov. 9, 2012).

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