Enterprise Products Partners will develop a new 416-mile, 24-inch diameter pipeline to transport crude oil and condensate from the company’s Midland, Texas terminal to its Sealy storage facility west of Houston – the company announced yesterday. From Sealy, the new pipeline would link to Enterprise’s ECHO terminal through an interconnect with the Rancho II pipeline, which is scheduled to be in service in July 2015. Through ECHO, customers will have direct access to every refinery in Houston, Texas City, Beaumont and Port Arthur, as well as Enterprise’s dock facilities.
The new pipeline will have the capability to provide up to 540,000 barrels per day (“BPD”) of take-away capacity for growing volumes of crude oil, and condensate from the Permian Basin. Service is expected to begin in the second quarter of 2017.
The hydrocarbons will be gathered by trucks and pipelines into Enterprise’s Midland terminal and then delivered in up to four segregated batches to Sealy. The different grades of hydrocarbons handled by the Midland-to-Sealy pipeline include West Texas Sour, West Texas Intermediate, Light West Texas Intermediate and condensate. Enterprise is in the process of adding incremental storage capacity to support the new pipeline and the existing West Texas Gathering System.
“The commitments we received for the Midland-to-Sealy pipeline reflect the long-term, positive outlook producers have for the Permian Basin and the value provided by this logical expansion of our integrated energy value chain,” said Michael A. Creel, chief executive officer of Enterprise’s general partner. “In addition to facilitating crude oil and condensate production from one of our most important domestic basins, the Midland-to-Sealy pipeline will provide customers with adequate supply out of the Permian Basin and unsurpassed market access to the vast Gulf Coast refining complex, as well as dock access necessary for growing export opportunities.”
Creel added, “Proper segregation is essential when transporting batched products and we take that responsibility very seriously. In support of that commitment Enterprise has implemented a system designed to ensure the company complies with all appropriate regulations.”
Enterprise now has approximately $7.5 billion of capital growth projects under construction, several of which will benefit customers on the new Midland-to-Sealy pipeline. Specifically, the 36-inch diameter Rancho II pipeline, which extends 88 miles from Sealy, to the ECHO terminal, will have over one million BPD of capacity for crude oil and condensate from the Permian Basin and the Eagle Ford Shale.
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