Phillips 66 (PSX) reported earnings on Fri 28 Apr 2017 (b/o)

** charts before earnings **

 

** charts after earnings **

Phillips 66 beats by $0.50:

• Reports Q1 (Mar) earnings of $0.56 per share, $0.50 better than the Capital IQ Consensus of $0.06. 

Strategic Update:

• Phillips 66 continues to advance its growth projects in Midstream and Chemicals and invest in return-enhancing projects in Refining. In Midstream, the Freeport LPG Export Terminal was completed and became fully operational late in the fourth quarter of 2016. The export terminal has a capacity of 150,000 BPD that is being utilized for term and spot cargos. The facility demonstrated its ability to operate at design capacity in the first quarter. Phillips 66 has a 25 percent interest in joint ventures to develop the 470,000 BPD Dakota Access Pipeline (:DAPL) and Energy Transfer Crude Oil Pipeline (:ETCOP). Construction on both pipelines has been completed. Commercial operations are expected to begin by June 1. The company continues to expand its Beaumont Terminal, which now has 9 million barrels of crude and product storage capacity. An additional 1.2 million barrels of product storage is planned to be in service by mid-2017. The facility is capable of exporting 400,000 BPD of crude or products, and this capacity is being expanded to 600,000 BPD. Phillips 66 Partners continues to advance its organic growth program. Progress continues on the Bayou Bridge Pipeline segment from Lake Charles to St. James, Louisiana, with commercial operations expected to begin in the fourth quarter of 2017. In addition, the Partnership is developing a new isomerization unit at Phillips 66's Lake Charles Refinery to increase production of higher octane gasoline blend components. Final project approval is expected in the first half of 2018. DCP Midstream recently simplified its structure, which better positions it for growth and improved capital allocation. Phillips 66 expects to receive distributions from DCP in 2017. DCP is expanding the Sand Hills Pipeline capacity to 365,000 BPD, with an expected in-service date in the fourth quarter of 2017. DCP is also expanding its DJ Basin footprint with construction of the new 200 million cubic feet per day Mewbourn 3 gas processing plant, which is expected to be in service in the fourth quarter of 2018. CPChem continues to progress its U.S. Gulf Coast Petrochemicals Project, which consists of a world-scale ethane cracker and two polyethylene derivative units. The polyethylene units are expected to be completed in mid-2017, and the cracker is expected to be complete in the fourth quarter of 2017. This project will increase CPChem's global ethylene and polyethylene capacity by approximately one-third. In Refining, the company is nearing completion of the project to increase heavy crude processing capability at the Billings Refinery to 100 percent, with start-up expected in June. At both the Bayway and Wood River refineries, the company is modernizing fluid catalytic cracking units to increase clean product yield. Both projects are expected to be complete in the first half of 2018. Phillips 66 is also implementing yield improvement efforts at several other refineries, including Ponca City, where a diesel recovery project is expected to be complete in the second half of 2017.