Enbridge to decide on Texas crude terminal in 2021

Enbridge expects to reach a decision this year on building a 15mn bl Texas crude terminal to support exports and local refinery demand.

The Jones Creek terminal in Freeport, Texas, would be integrated with the 950,000 b/d Seaway pipeline system that moves crude from Cushing, Oklahoma, to the Houston area. Enbridge owns Seaway in a joint venture with Enterprise Products Partners.

Enbridge expects to reach a final investment decision on the Jones Creek terminal this year, said senior vice president of corporate development Phil Anderson in an interview. The terminal would take two to three years to build, he said.

Enterprise and Enbridge are weighing a future expansion of Seaway but that plan is on hold for now. "It is a project that we have on the shelf, when the time is right and the project is needed, we will be ready to react," said Enterprise chief commercial officer Brent Secrest.

Enbridge recently agreed to purchase about 6.6mn bl of storage at Cushing from Blueknight Energy Partners, pushing its total to 26mn bl.

Enbridge also has an option to buy into Enterprise's planned offshore crude export terminal – the Sea Port Oil Terminal (SPOT) off the coast of Freeport, which will be able to fully load very large crude carriers (VLCCs). The project includes two crude pipelines running from the port to the shore. Two single-point mooring buoys will be able to load and export oil at about 85,000 bl/hour.

Enbridge is bullish on the growth of US crude exports and on the SPOT project.

"We feel very, very good about the outlook around that. And we expect this year to see both a permit and likely us firming up our position in that opportunity," Anderson said.

Enterprise told Argus last week it is hoping to get a federal approval of SPOT in the third quarter.

The number of US offshore VLCC export projects has narrowed in the wake of Covid-19 and its economic consequences. Only four major projects are still in the works, including SPOT. Sentinel Midstream and Energy Transfer each have an offshore VLCC project. A fourth is a joint plan by Phillips 66 and Trafigura.

Only one US port is currently able to fully load a VLCC — the Louisiana Offshore Oil Port (Loop) about 20 miles (32km) off the coast from Grand Isle, Louisiana.

Anderson will be one of the speakers at the Argus Crude Live virtual conference on 26-28 January.

By Eunice Bridges