HOUSTON, Aug 3 (Reuters) - Plains All American on
Wednesday raised its 2022 profit forecast for the second time
this year, and said it expects strong demand on its pipelines
carrying U.S. shale oil to the Gulf Coast.
The pipeline operator increased full-year adjusted earnings
guidance by $100 million to about $2.38 billion, as it expects
higher crude and natural gas liquids volumes.
U.S. crude oil has been in high demand in international
markets with West Texas Intermediate crude trading at a discount
to globally-traded Brent crude, making purchases attractive to
U.S. light sweet crude, a bulk of which is produced in the
Permian basin of West Texas and New Mexico, also has been
snapped up in Europe with buyers looking to replace Russian
"The marginal demand right now is the international
(market)," said Jeremy Goebel, Plain's chief commercial officer.
Prices at the Corpus Christi, Texas, export hub are selling at a
premium to Houston and other export ports.
"Right now, Corpus (Christi) is the best price with low
inventories and high prices," he said.
Plains has two key long-haul pipelines, Cactus and Cactus
II, which move oil from the Permian basin to Corpus Christi.
Plain's Chief Executive Officer Willie Chiang also said he
expects more volumes to reach its long-haul pipelines as
production in the Permian basin ramps up.
Average daily crude oil volumes in the second quarter rose
30% on its Permian basin pipelines, Plains said, with oilfield
activity trending about 10% above its initial expectations.
Its shares rose 3.6% in after-hours trading on Wednesday to
Larger pipeline rival Magellan Midstream Partners
gave a similar view last week, saying Permian volumes on its
Longhorn and Bridgetex pipelines to Houston declined as shippers
likely moved barrels to the international market.
Plains' adjusted second quarter net income allocated to
common unitholders rose 29% to $210 million.
(Reporting by Arathy Somasekhar in Houston
Editing by Chris Reese)