Aug. 9 (UPI) -- The volume of crude oil flowing through its pipeline networks in the United States increased 12 percent from last year, Plains All American Pipeline stated.
The company reported second quarter revenue of $8.1 billion, lower than the consensus estimate from Zacks Investment by 12 percent.
The company is one of the more active transit companies in the Lower 48 shale basins. Its Earnings Before Interest, Taxes, Depreciation and Amortization, a measure of its earning potential, increased 21 percent from second quarter 2017.
The company said the increase was driven by higher volumes of fluids moving through its Cactus pipeline systems in the Permian shale basin in the southern United States.
Permian oil accounts for the vast majority of liquids moving through pipeline networks controlled by Plains. The total amount of oil flowing through the company's pipelines increased 12 percent from second quarter 2017 to average 5.5 million barrels per day.
"Second-quarter 2018 also benefited from (the) Diamond pipeline being placed into service in late 2017," the company's statement read.
The Diamond pipeline is a 440-mile network designed to carry as much as 200,000 barrels of shale oil per day from the main U.S. oil storage facility in Cushing, Okla., to a Valero refinery in Tennessee.
Cushing storage levels are important for traders watching supply and demand metrics in the U.S. market. Those metrics influence the price of oil and U.S. data show a draw on Cushing inventories last week.
Total U.S. oil production is straining existing pipeline capacity. U.S. tariffs on steel pipe, which few domestic manufacturers make, could drive up the cost of new pipeline infrastructure and eventually throttle production trends.
In its earnings statement, Plains said it increased its capital spending program to finance new networks in the Permian shale.
"Strong Permian basin fundamentals, combined with the growth and execution of our capital program, provide visibility for continued momentum for fee-based cash flow growth," Willie Chiang, the executive vice president and chief operating officer, said in a statement.