Crude pipeline volumes for the four biggest US midstream operators logged a record high of 16.5mn b/d in the fourth quarter, according to company data, mostly driven by rising flows from the Permian basin. Overall flows were up by 6pc from the previous quarter and up by more than 50pc from the 10.8mn b/d logged in the first quarter of 2021, which was the low-water mark for the COVID-19 pandemic cycle. Flows remained well above the baseline level of 14.3mn b/d set in the first quarter of 2020 before pandemic-induced demand shocks and a battle for market share between Saudi Arabia and Russia sent crude prices tumbling to historic lows. Permian basin pipeline operators' fates are closely tied to field producers in west Texas and eastern New Mexico, who saw an unprecedented drop in output in April 2020 along with a day of negative pricing at the US pipeline hub of Cushing, Oklahoma. The tides have since turned in the Permian, where rising output drove overall US crude production to an all-time record of 13.3mn b/d in December. ExxonMobil's $59.5bn takeover of US independent Pioneer Natural Resources doubles down on the prolific basin's staying power. US midstream operator Plains All American Pipeline said it expects output from the Permian to set a fresh record high in 2024, synchronizing with oil majors' plans to boost production in the top-performing shale basin. Permian output is expected to grow to 6.4mn b/d in 2024 from 6.1mn b/d in 2023, Plains said in an investor presentation. Place your bets The increase will be mainly driven by efficiency gains, as the number of active rigs in the basin holds at 300-320 horizontal rigs. "Our bet would be on the US [exploration and production companies], that they would figure out how to get higher recoveries" from the Permian basin, Plains executive vice-president Al Swanson said. Plains' projections are in line with recent guidance from top US oil majors, who are targeting longer lateral wells and faster drilling times to squeeze more output from existing infrastructure. Chevron aims to boost Permian output by 10pc this year, while ExxonMobil expects 7pc growth from its operations there. Long-haul volumes on Plains' crude pipelines rose by 17pc from the previous quarter to 1.6mn b/d and were up by 7pc from year-earlier levels. Plains said it expects high utilization on the 670,000 b/d Cactus II pipeline, its joint venture with Enbridge, which runs from the Permian to Corpus Christi, Texas, on the central coast. It also expects rising volumes on its Basin pipeline system from Midland, Texas, to the US midcontinent storage hub at Cushing. The lion's share of gains in output from the top four US midstream operators came from Plains and Energy Transfer, while Enterprise Products Partners' volumes held steady and NuStar volumes were up by 100,000 b/d to 1.3mn b/d. Energy Transfer set record volumes on its crude pipeline system in the fourth quarter as production from the Permian rose. Texas crude transport volumes rose by 39pc from a year earlier to 5.9mn b/d, driven by rising output from the Permian. Crude volumes also got a boost from Energy Transfer's recent acquisitions. Energy Transfer in August agreed to buy Crestwood Equity Partners in a transaction valued at $7.1bn, after moving to purchase Lotus Midstream in March for $1.45bn. The Lotus acquisition assets included the Centurion pipeline that connects Permian producers with the hub at Cushing, and more than 2mn bl of storage capacity in Midland. Volumes on Energy Transfer's Bakken pipeline were higher because of rising output from the Bakken shale in North Dakota, and volumes on its Bayou Bridge system in Louisiana grew because of strong Gulf Coast refinery demand. Energy Transfer's crude exports from its terminals in Nederland and Houston, Texas, fell to 3.4mn b/d, down by 5pc from the previous quarter's record of 3.6mn b/d but up by 16pc from a year earlier. Enterprise Products Partners posted record volumes on its crude pipelines and marine terminals in the fourth quarter. Crude pipeline transportation volumes increased to a record 2.6mn b/d in the fourth quarter, up marginally from the previous quarter and a 32pc increase from a year earlier, with increased flows on its Midland-to-Echo system from the Permian to the Houston area. Enterprise moved a record 1mn b/d at its crude oil marine terminals in the fourth quarter, up slightly from the previous quarter and up by 32pc from a year earlier, with rising volumes at the Enterprise Hydrocarbons Terminal (EHT) on the Houston Ship Channel. "We are seeing more crude across our docks," Enterprise co-chief executive Jim Teague said. By Chris Baltimore View on the Argus Website