This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

To Cut Pipeline Costs, Magellan Hooks Up With Explorer

Stocks in this article: MMP

TULSA, Okla. -- Magellan Midstream Partners LP (MMP) said Monday it won't build an 80-mile pipeline from Port Arthur to Houston as planned, but will instead link its terminal to an existing Explorer pipeline in a move to save about $120 million.

The petroleum distributor is joining forces with Explorer Pipeline to transport petroleum from Motiva Enterprises LLC's Port Arthur, Texas refinery to markets in East Texas. Magellan will now build a 9-mile pipeline to connect its East Houston terminal to Explorer's pipeline that transports petroleum products from Port Arthur to Fauna, Texas, just east of Houston.

Magellan also will connect its East Houston terminal and Motiva's existing Pasadena terminal. The company expects these projects to be up and running by 2011 and cost half of the original $240 million project.

"By utilizing existing infrastructure, the revised scope significantly lessens our execution risk while providing a slightly improved initial return," said Chief Executive Don Wellendorf in a statement. As the price of oil and natural gas has plunged from record highs this summer, energy companies have trimmed capital spending plans.

Magellan said it still will build more storage, boost loading capabilities and add truck rack lanes at its terminals and facilities. The company estimates the projects to generate an average annual operating profit of about $9 million during the first three years of full operation.

Based on these expansion projects and the pipeline revision, management expects to spend about $270 million in 2008 and $190 million in 2009. More than $500 million worth of additional expansion plans also are being evaluated, the company said.

Shares of Magellan Midstream Partners rose 17 cents, or 0.60 percent, to $28.59 in afternoon trading.

Copyright 2008 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,778.15 +421.28 2.43%
S&P 500 2,061.23 +48.34 2.40%
NASDAQ 4,748.3960 +104.0840 2.24%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs