Plains All American Pipeline, L.P. (NYSE: PAA)
and Enterprise Products Partners L.P. (NYSE: EPD) today announced they
have formed a 50/50 crude oil pipeline joint venture in South Texas. The
arrangement provides for PAA and EPD to consolidate certain portions of
previously announced pipeline projects servicing the Eagle Ford shale
play in South Texas. The joint venture system is supported by long-term
commitments totaling 210,000 barrels per day. The consolidation will
provide shippers with increased market flexibility and enable PAA and
EPD to optimize their capital investments.
The joint venture will include a 140–mile crude oil and condensate line
extending from Gardendale in LaSalle County to Three Rivers in Live Oak
County and continuing on to Corpus Christi, and a new 35-mile pipeline
segment from Three Rivers to Enterprise's Lyssy station in Wilson
County. The system, which is currently under construction, will have a
targeted capacity of 350,000 barrels per day and will include a marine
terminal facility at Corpus Christi and 1.8 million barrels of
operational storage capacity across the system. At Lyssy, the joint
venture pipeline will interconnect with EPD's existing South Texas Crude
Oil Pipeline that transports crude oil to Sealy, Texas for ultimate
delivery into the Houston-area refinery market. Portions of the system
are expected to be placed in service in the fourth quarter of 2012, with
the balance of the system expected to be placed into service in the
first half of 2013. The joint venture system will be an intrastate
common carrier pipeline with a posted initial base tariff rate of $1.25
per barrel from Gardendale to all destinations.
PAA will serve as the operator of the joint venture system, which will
not include PAA's Gardendale Gathering System or EPD's South Texas Crude
Oil Pipeline.
"We are very pleased to work with Enterprise to optimize our respective
construction activities in South Texas. This joint venture provides
necessary take-away capacity for the growing Eagle Ford region, while
reducing capital costs and enhancing returns for both parties," said
Harry Pefanis, President and Chief Operating Officer of Plains All
American Pipeline. "The combined project will provide shippers with the
option to deliver to Three Rivers, Corpus Christi, Houston, and with
dock capabilities at Corpus Christi to access other gulf-coast markets."
"Consistent with Enterprise's philosophy of developing mutually
beneficial relationships, this joint venture is a win-win solution for
both companies as well as producers in the Eagle Ford Shale," said A.J.
"Jim" Teague, Executive Vice President and Chief Operating Officer for
Enterprise's general partner. "Combining these two projects is a more
efficient use of our capital and it expands market access for our
shippers."
Plains All American Pipeline, L.P. is a publicly traded master limited
partnership engaged in the transportation, storage, terminalling and
marketing of crude oil and refined products, as well as in the
processing, transportation, fractionation, storage and marketing of
natural gas liquids. Through its general partner interest and majority
equity ownership position in PAA Natural Gas Storage, L.P. (NYSE:PNG),
PAA owns and operates natural gas storage facilities. PAA is
headquartered in Houston, Texas.
Enterprise Products Partners L.P. is one of the largest publicly traded
partnerships and a leading North American provider of midstream energy
services to producers and consumers of natural gas, NGLs, crude oil,
refined products and petrochemicals. The partnership's assets include
approximately: 50,700 miles of onshore and offshore pipelines; 190
million barrels of storage capacity for NGLs, petrochemical, refined
products and crude oil; and 14 billion cubic feet of natural gas storage
capacity. Services include: natural gas gathering, treating, processing,
transportation and storage; NGL transportation, fractionation, storage,
and import and export terminaling; offshore production platform
services; crude oil and refined products transportation, storage and
terminaling; petrochemical transportation and storage; and a marine
transportation business that operates primarily on the United States
inland and Intracoastal Waterway systems and in the Gulf of Mexico. For
more information about Enterprise, please visit www.enterpriseproducts.com.
Forward Looking Statements
This release includes forward-looking statements that involve certain
risks and uncertainties that could cause actual results or outcomes to
differ materially from results or outcomes anticipated in such
forward-looking statements. These risks and uncertainties include, among
other things, various factors that could delay, prevent, increase costs
of or otherwise adversely impact the construction, operation or
performance of the joint venture's pipelines and other facilities,
including the following: (i) the availability of adequate third-party
production volumes for transportation, (ii) factors that could cause
declines in volumes shipped on the existing and proposed pipelines, such
as declines in production from existing oil and gas reserves or failure
to develop additional oil and gas reserves, (iii) continued
creditworthiness of, and performance by, the joint venture's customers
and counterparties, (iv) shortages or cost increases of supplies,
materials or labor, (v) difficulties obtaining necessary rights of way
and permits, (vi) weather interference, (vii) the impact of current and
future laws, rulings, governmental regulations, accounting standards and
statements and related interpretations, (viii) general economic, market
or business conditions and the amplification of other risks caused by
volatile financial markets, capital constraints and liquidity concerns,
and (ix) other factors and uncertainties discussed in the respective
filings of PAA and EPD with the Securities and Exchange Commission.
PAA
Roy I. Lamoreaux, 713-646-4222
or
EPD
Randy
Burkhalter, 713-381-6812 (Investor Relations)
Rick Rainey,
713-381-3635 (Media Relations)