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Enterprise expands Permian line to 540,000 b/d

16 Apr 2018 16:21 (+01:00 GMT)
Enterprise expands Permian line to 540,000 b/d

Houston, 16 April (Argus) — Enterprise Products Partners has expanded its Midland-to-Sealy, Texas crude pipeline by 90,000 b/d to 540,000 b/d and plans another capacity increase next month.

The line is now in full service and capable of moving batched grades of crude and condensate, the company said today.

Enterprise is planning a further expansion of the line to 575,000 b/d in May with the completion of incremental tankage and infrastructure and operating enhancements. The expanded capacity is fully subscribed under long-term contracts, amid growing interest in moving Permian basin crude to the Gulf coast for export.

The pipeline moves crude from Enterprise's Midland terminal to its Sealy storage facility west of Houston, which is connected to the company's Echo terminal in Houston. From Echo, shippers can reach refineries in Houston, Texas City, Beaumont and Port Arthur, Texas, as well as Enterprise's dock facilities.

The line has capacity to move four grades of crude — West Texas Intermediate (WTI), higher-gravity crude (dubbed west Texas light sweet), West Texas Sour (WTS), and condensate.

The expansion on the line comes as widening price spreads between Midland and Houston suggest that takeaway constraints could be affecting oil producers. The May spread on 13 April between WTI Midland and WTI Houston was about $6.60/bl, keeping the May month-to-date average around $7/bl, according to Argus data.

Volumes on the Midland-to-Sealy pipeline averaged 333,000 b/d in the fourth quarter since it began limited service in November.

The uncommitted rate on the line from Midland to the Echo terminal is $6.74/bl, according to a tariff filed to Texas regulators which went into effect 1 April.

Enterprise does not disclose committed rates for the line, which are negotiated with individual shippers.

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