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By Swagato Chakravorty

In a recent agreement, Spectra Energy Corp. (NYSE: SE) will gain a one-third interest in the Sand Hills and Southern Hills pipelines once they are complete.

According to the Sacramento Bee, Phillips 66 (NYSE: PSX) and DCP Midstream, LLC—a 50/50 joint venture between Spectra and Phillips—will also own one-third each. The three companies will then equally split funding for any remaining capital expenses.

From the Sacramento Bee:

"Sand Hills and Southern Hills are outstanding natural gas liquids (NGLs) pipeline projects that are a strategic complement to our existing network of natural gas pipelines across North America. Investing in these NGL pipelines, with our DCP Midstream joint venture partner Phillips 66, allows DCP Midstream to continue advancing its attractive growth plans," said Greg Ebel, president and chief executive officer, Spectra Energy Corp. "As these NGL pipelines begin serving customers later this year and in 2013, they will directly add attractive, stable earnings and cash flow to Spectra Energy's results.

The Sand Hills pipeline will run from the Permian basin and the Eagle Ford Shale all the way to markets on the Gulf Coast, transporting NGL. Initially, the pipeline will carry up to 200,000 barrels per day, with an expansion planned for up to 350,000 barrels per day.

The first phase just recently came online transporting liquids from the Eagle Ford. The Permian connection should be up and running by the second quarter of 2013.

Southern Hills, operating between the Mid-Continent region and Mond Belvieu, will have an initial capacity of up to 150,000 bpd, expanding later to 175,000 bpd. It will coming online by around the middle of next year.

Source: Spectra Energy Gains Pipeline Interest