Phillips 66 Announces Total Capital Budget Of $6.8 Bln In 2015

(RTTNews) - Oil refiner and chemical maker Phillips 66 (PSX) Friday announced it 2015 capital budget of $4.6 billion. These investments are intended to support midstream business growth, including that of the company's master limited partnership, Phillips 66 Partners LP, as well as ensure ongoing operating excellence.

Including the company's portion of capital spending by joint ventures DCP Midstream (DCP), Chevron Phillips Chemical Company (CPChem) and WRB Refining, all of which are expected to be self-funded, the company's total 2015 capital program is expected to be $6.8 billion.

"The 2015 capital program reflects our commitment to grow our higher-value businesses while enhancing returns in Refining," said chairman and CEO Greg Garland. "We are executing a portfolio of major Midstream and Chemicals projects while evaluating a significant backlog of investment opportunities.

"We remain committed to returning capital to shareholders through dividend growth and our share repurchase program. We expect double-digit increases in dividends for the next two years, and $2.6 billion remained available at the end of the third quarter under our share repurchase authorization.

In Midstream, excluding DCP, Phillips 66 plans to invest $3.2 billion in its Natural Gas Liquids (NGL) and Transportation business lines.

In NGL, the company continues construction of the 100,000 barrel-per-day Sweeny Fractionator One and the 4.4 million-barrel-per-month Freeport LPG Export Terminal on the U.S. Gulf Coast.

In Transportation, the company is investing in pipeline and rail infrastructure projects to move crude oil from the Bakken/Three Forks production area of North Dakota to market centers throughout the U.S. In addition, expansion of the Beaumont Terminal and related infrastructure opportunities are being pursued.

Additional Midstream investments are planned within DCP, a 50-50 joint venture with Spectra Energy that also includes DCP Midstream Partners. DCP will leverage its infrastructure to launch new gathering, processing, and NGL growth projects, mainly in the Niobrara, Denver-Julesburg, Eagle Ford and Permian basins.

DCP also expects to increase natural gas processing capacity in these basins and complete other gathering system expansions during 2015. Phillips 66's share of DCP's 2015 planned capital expenditures is $550 million.

In Chemicals, CPChem, a 50-50 joint venture with Chevron, is investing in projects aimed at capturing cost-advantaged petrochemical feedstocks on the U.S. Gulf Coast. Phillips 66's share of CPChem's 2015 capital expenditures is expected to be $1.4 billion.

Phillips 66 plans $1.1 billion of capital expenditures in Refining, approximately 75 percent of which will be sustaining capital.