Magellan Midstream Partners LP has entered into a fee-based, take-or-pay agreement with Trafigura Trading LLC for the exclusive use of Magellan's 50,000-b/d condensate splitter in Corpus Christi, Tex.
The agreement was made as part of an amicable resolution of a dispute between the parties under the previous contract. Magellan has dismissed its lawsuit against Trafigura as part of the resolution.
Magellan recently completed construction of the splitter, which is fully supported by the long-term commitment from Trafigura. Magellan expects to begin commercial operation of the splitter during late second quarter.
In conjunction with the agreement, Magellan will build an additional 300,000 bbl of storage to bring total storage supporting the splitter to 1.5 million bbl. The firm also will make other minor modifications to the splitter, increasing expected capital spending for the project to $330 million.