Houston oil pipeline giant Plains All American saw its net income fall in the fourth quarter as it ramps up spending for a build out of pipeline infrastructure from the booming Permian Basin to the Houston region.
Plains reported Tuesday its fourth-quarter net income fell 49 percent from $247 million at the end of 2015 down to $126 million last quarter. However, Plains’ quarterly revenues grew 19 percent to $5.95 billion from $5 billion. For the full year, Plains posted a $726 million profit versus $903 million in 2015.
However, Plains is focused on new spending to expand in West Texas and New Mexico. Plains announced in January it will buy the Alpha Crude Connector pipeline gathering and storage system for $1.2 billion from Midland-based Concho Resources and Dallas private-equity firm Energy Spectrum Capital. Plains also said it will expand its existing BridgeTex and Cactus pipeline systems in West Texas.
Plains Chairman and Chief Executive said he’s focused on capitalizing off of growing drilling and production activity in the Permian.
“These activity levels have increased our conviction in significant Permian Basin production growth in 2017,” Armstrong said in a prepared statement.