(Add background, prices, details about rates)
NEW YORK, OCTOBER 1 (Reuters) – Sunrise Pipeline sets tariffs for the new extension of the raw pipeline from Loving County, Texas in the Perm basin to the Cushing, Oklahoma storage facility, with effect from November 1, according to a registration request from Monday.
It is expected that the start-up of the expanded line will cause a bottleneck that has been reducing raw material prices in nearby Midland, Texas WTC-WTM for months. Crude oil is already coming in line and is expected to be fully operational in early November.
The pipeline set uncommitted spot prices at $ 1.69 per barrel and committed anchor shippers at $ 1.70, while committed non-anonymous shippers are charged $ 1.75 a barrel, said Sunrise in a US Federal Energy Regulatory Commission submission.
Committed shippers must enter into an agreement with Sunrise during the open season in 2017. Anchored shippers must have signed an agreement to send at least 80,000 barrels per day (bpd) with Sunrise for a period of at least seven years.
The pipeline, operated by Plains All American LP, is one of two projects planned to start partial operations, slightly more than the original schedule.
Plains 670,000 barrels per day (bpd) Cactus II line from the Permian to Corpus Christi begins partly in the third quarter of 2019.
Pipeline companies are racing to add lines, because production in the Permian Basin, the largest US oil slick, exceeds the transport capacity for pipelines. It is expected that new lines will add more than 1.5 million bpd extra capacity midway through the end of 2019.
West Texas Intermediate on Midland traded around $ 7 on Monday and $ 7.50 per barrel under the US raw futures WTC-WTM, well above a discount of around $ 17 a barrel at the end of August, the weakest level in four years.
Plains was an active buyer on the spot market, created barrels to fill the line and that helped to support the prices, according to traders. (Reporting by Devika Krishna Kumar in New York Editing by Chizu Nomiyama)