ExxonMobil Pipeline in January will take over operations of the US Strategic Petroleum Reserve's 2-million-barrel capacity St. James, Louisiana, terminal that can distribute government-owned crude to Gulf Coast and Midwest refiners.
The Department of Energy said Monday that ExxonMobil signed a 20-year lease to operate the St. James marine terminal and 36-inch-diameter Redstick pipeline that connects to the Bayou Choctaw SPR facility. The lease will end Shell's 22-year operational control of the facilities.
St. James is the pricing hub for Gulf Coast benchmark Light Louisiana Sweet crude. In the event of an emergency SPR drawdown, the terminal can distribute crude from the SPR's Bayou Choctaw site to the Midwest via Capline, and to Gulf Coast refineries via Locap, Shell, NuStar and Plains terminals.