Enterprise Products (EPD) Seeks Commitment For ECPL Expansion
Zacks Investment Research | May 29, 2018 04:24AM ET
Enterprise Products Partners L.P. (NYSE:EPD) intends to expand capacity at its Enterprise Crude Pipeline LLC (“ECPL”) West Texas System and has announced a binding open season.
Crude oil from points in New Mexico is transferred by ECPL to the partnership’s terminal in Midland, TX. The expansion of the pipeline system will provide the required augmentation to the takeaway capacity. The pipeline is intended to facilitate transportation of high crude oil production from the Delaware Basin in New Mexico.
The open season seeks customer commitments for capacity expansion on the West Texas System from ECPL’s Lynch, Hobbs and Red Hills stations in Lea County, New Mexico to the Midland terminal. At Midland, shippers will have access to storage and terminal services besides being connected to multiple transportation substitutes like trucking and pipeline infrastructure.
These additional alternatives provide access to diverse downstream markets including the Gulf Coast. The expanded West Texas System is expected to commence operations in the third quarter of 2018.
Enterprise Products is one of the largest integrated midstream energy companies with system that facilitates the reduction of the impact of cyclical commodity swings. The partnership has successfully executed growth projects as well as mergers and acquisitions worth $38 billion and $26 billion, respectively, since its IPO in 1998. Currently, it has growth projects of about $5.3 billion under construction. In 2018, Enterprise Products has completed growth capital projects worth $400 million.
Price Performance
In the past three months, Enterprise Products’ shares have gained 10.5% compared with the industry ’s 1.2% rise.
Zacks Rank & Key Picks
Enterprise currently carries a Zacks Rank #3 (Hold).
A few better-ranked players in the same sector are Nine Energy Service, Inc (NYSE:NINE) , Equinor ASA (NYSE:EQNR) and CVR Refining, LP (NYSE:CVRR) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see Zacks Investment Research
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