Energy Transfer Seeks Commitment For PE3 Remaining Capacity

 | May 30, 2018 06:36AM ET

Energy Transfer Partners, L.P. (NYSE:ETP) recently announced that its unit, Permian Express Partners LLC started a marketing process to obtain binding commitments from potential crude shippers for its Permian Express 3 (PE3) pipeline’s 50,000 barrels per day (BPD) capacity. It constitutes the remaining capacity of its phase 1’s 140,000 BPD volumes. The phase 1 came online in the fourth quarter of 2017.

Notably, huge production from the Permian Basin and inadequate pipeline capacity have limited producers’ profit level in the shale play recently. The situation forced the producers to sell their products at a discounted rate, which makes the Permian Express 3 a hot cake for the shippers. The pipeline will ship Permian crude to the U.S. Gulf Coast and also reach the Nederland, TX markets.

The pipeline is expected to enhance the partnership’s midstream value chain and strengthen its foothold in the United States’ most prolific basin. Moreover, the partnership expects the pipeline to significantly contribute to improvement in the profit level. Further, the Dallas, TX-based midstream firm will keep on evaluating the possibility of expanding the pipeline in the future.

Energy Transfer anticipates the remaining capacity to be added in operation in the fourth quarter of 2018. Per the partnership, the available capacity is strictly for intrastate service. It follows the rules depicted by the Texas Railroad Commission.

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Energy Transfer has lost 16.2% in the past year compared with a 14.8% decline for its industry .