M2 Infrastructure LLC has announced that it has entered into a Memorandum of Understanding (MoU) with TransCanada Corporation (TransCanada) to pursue construction of 6.2 million bbls of new crude oil storage at TransCanada’s terminal in Cushing, Oklahoma. Cushing is the most active crude oil trading hub in the world, and the delivery point for the West Texas Intermediate futures contract listed on the Chicago Mercantile Exchange (CME).
The new crude oil storage will be owned by M2 Infrastructure and operated by TransCanada. M2 Infrastructure has an option to build up to 20 million bbls of storage, which would be built in subsequent phases. The project and option to expand are subject to completion of definitive agreements between the parties and obtaining required approvals and land rights. Construction of the crude oil storage is expected to begin in late 2017.
M2 Infrastructure plans to work with Matrix Global Holdings, the parent company of Matrix Markets, to sell storage capacity to its customers through on-line auctions of futures contracts and/or physical forward agreements. The auction programme will be similar to the highly successful LOOP Sour auction developed by CME, LOOP LLC and Matrix Markets.
“We are excited to continue transforming the way midstream operators bring efficiencies to their clients,” said J. Robert Collins, Jr., co-founder and Manager of M2 Infrastructure and Matrix Global Holdings. “This project’s unique position in Cushing, combined with the innovative excellence of Matrix, should provide the lowest cost, highest throughput, most liquid and most connected storage solution in the midcontinent – eliminating costly limitations of alternative storage programmes.”
“TransCanada is committed to developing energy infrastructure solutions in the US and Canada and pursuing this opportunity fits well in our plans to provide enhanced flexibility to our customers,” said Paul Miller, TransCanada’s executive vice-president and president, Liquids Pipelines.
Read the article online at: https://www.tanksterminals.com/storage-tanks/16032017/m2-infrastructure-and-transcanada-to-pursue-storage/