Phillips 66 to Grow Permian Midstream Business with $2.2B EPIC NGL Acquisition

Phillips 66 (NYSE:PSX) announced today that it has entered into a definitive agreement to buy EPIC Y-Grade GP, LLC and EPIC Y-Grade, LP, which own various subsidiaries and long haul natural gas liquids pipelines, fractionation facilities and distribution systems (“EPIC NGL”) for total cash consideration of $2.2 billion, subject to customary purchase price adjustments. Upon closing, this transaction is expected to be immediately accretive to earnings per share.

“This transaction bolsters Phillips 66’s position as a leading integrated downstream energy provider,” said Mark Lashier, chairman and CEO of Phillips 66. “This transaction optimizes our Permian NGL value chain, allows Phillips 66 to provide producers with comprehensive flow assurance, reaching fractionation facilities near Corpus Christi, Sweeny, and Mont Belvieu, Texas, and is expected to deliver attractive returns in excess of our hurdle rates.”

The EPIC NGL business consists of two fractionators (170 MBD) near Corpus Christi, Texas, approximately 350 miles of purity distribution pipelines and an approximately 885-mile NGL pipeline (175 MBD) linking production supplies in the Delaware, Midland and Eagle Ford basins to such fractionation complexes and to the Phillips 66 Sweeny Hub. EPIC NGL is in the process of increasing its pipeline capacity to 225 MBD and has sanctioned a second expansion to increase capacity to 350 MBD. Phillips 66 does not expect to increase its recently announced 2025 capital program in connection with that expansion. EPIC NGL has also identified a third fractionation facility that could bring its fractionation capacity up to 280 MBD. The facilities connect Permian production to Gulf Coast refiners, petrochemical companies, and export markets and will be highly integrated with the Phillips 66 asset base.

The transaction is subject to customary closing conditions, including required regulatory clearance.

For more information on EPIC Midstream, please visit their website.

About Phillips 66

Phillips 66 (NYSE: PSX) is a leading integrated downstream energy provider that manufactures, transports and markets products that drive the global economy. The company’s portfolio includes Midstream, Chemicals, Refining, Marketing and Specialties, and Renewable Fuels businesses. Headquartered in Houston, Phillips 66 has employees around the globe who are committed to safely and reliably providing energy and improving lives while pursuing a lower-carbon future. For more information, visit phillips66.com