Enterprise Products Partners has obtained permits to construct another crude pipeline out of Midland, Texas.
If successful, it would be called Midland-to-ECHO 3 pipeline.
“This integrated system joins together our pipeline storage, Houston distribution system and Marine terminals, safeguarding quality for both producers and end users by way of uninterrupted delivery from the wellhead to the refineries or docks,” said A. J. Teague, CEO, director of the general partner, in a transcript for its first quarter 2019 earnings meeting on May 1. “If we are able to successfully underwrite this third pipeline, we would have a lot of flexibility to convert Midland-to-ECHO 2 back into NGL service should demand be supportive.”
The firm is also expecting to complete the expansions of Front Range and Texas Express NGL pipelines in the third quarter.
The firm placed the initial phase of its Shin Oak NGL pipeline in service at the end of February and it’s currently running at 250,000 barrels a day. It also completed the conversion of one of its Seminole pipelines from NGL to crude service, which is referred to as Midland-to-ECHO 2, and it is flowing greater than 200,000 barrels a day. Note that given its location and interconnects, the firm will always have flexibility to convert this pipeline back to NGL service depending on the pipeline supply demand balances for crude oil and NGLs in the future.
“I doubt that anyone else will be able to offer this type of future flexibility to Permian producers and to markets,” said Teague.
On the demand side, Enterprise Products Partners expect to complete its LPG dock expansion in the third quarter, its IBDH plant at the end of the year and partially initiate service of the ethylene export terminal also in the fourth quarter.
Enterprise Products Partners recently completed the restart of 55,000 barrels a day of fractionation capacity at its Shoup and Tebone facilities in South Texas and Louisiana, respectively. The firms expect fractionation capacity to be tied again in the second half of 2019.
Anticipating further NGL supply growth, Enterprise Products Partners is currently constructing two new fractionators at Mont Belvieu, Texas, and developing PDH 2.
