Dallas-based Energy Transfer said last week it formed a joint venture with Sunoco to combine the two companies’ crude oil and produced water gathering assets in the Permian Basin. The JV will be operated by Energy Transfer and will include more than 5,000 miles of crude oil and water gathering pipelines and crude oil storage capacity of more than 11 million barrels. Energy Transfer said July 16 it will have 67.5 percent interest with Sunoco holding 32.5 percent.
Not included in the JV is Energy Transfer’s long-haul crude pipeline network that transports crude from Permian Basin to Cushing, Houston and Nederland.
Analyst James Taylor of East Daley Capital told reporters the JV could benefit both companies. “Energy Transfer is acquiring a nice system in the core of the Midland Basin,” he said. Ajay Bakshani of East Daley added Sunoco doesn’t have the expertise of Energy Transfer in operating gathering systems, and Energy Transfer does have Sunoco’s expertise in transporting products.