Enterprise Products in deal with Chevron to develop crude oil port
Reuters
Published Jul 30, 2019 05:16PM ET
Enterprise Products in deal with Chevron to develop crude oil port
(Reuters) - Enterprise Products Partners LP (N:EPD) signed long-term agreements with a Chevron Corp (N:CVX) unit to develop its Sea Port Oil Terminal in the Gulf of Mexico, the companies said in a statement on Tuesday.
Enterprise's offshore crude oil terminal is one of at least eight projects proposed off the Texas and Louisiana coasts to export oil from the region's shale fields.
It would compete with projects proposed by commodities trader Trafigura Ltd, private equity firm Carlyle Group (O:CG), and pipeline operators Magellan Midstream Partners (N:MMP), Tallgrass Energy LP (N:TGE), and Phillips 66 (N:PSX).
The companies hope to take advantage of rising shale production from the Permian Basin of West Texas and New Mexico, especially when another 2.3 million barrels per day of shale is expected to land at the U.S. Gulf Coast in the next year as new pipelines begin operation.
Enterprise signed the deals with Chevron U.S.A. Inc (CUSA) and it aims to build the export terminal at a site about 40 miles (64 km) off the coast of Houston and connect it to its existing crude pipelines. Up to two very large crude carriers (VLCCs) could moor at the site and load up to 2 million barrels per day.
The facility would connect to an onshore tank farm able to hold up to 4.8 million barrels of crude oil, according to its federal permit application.
The company said construction of the project is subject to the required approvals and licenses from the federal Maritime Administration, which is currently reviewing the application.
"The SPOT facility provides opportunity to significantly expand our export capacity and access multiple market centers as we increase our crude oil produced out of the Permian," said George Wall, president of Chevron Supply and Trading, a division of CUSA.
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Written By: Reuters
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