Enterprise Products Partners L.P. has signed long-term agreements with EOG Resources, Inc. to provide a comprehensive package of midstream energy services that will service EOG’s growing crude oil and associated liquids-rich natural gas production in the prolific Eagle Ford Shale in South Texas. Enterprise will use its existing assets and build additional infrastructure to provide EOG with a full range of midstream services for its Eagle Ford production, including crude oil transportation, storage and exchange; natural gas transportation, treating and processing; and natural gas liquids (NGL) transportation and fractionation.
“The South Texas Eagle Ford has the potential to be one of the largest crude oil discoveries in the United States, including the deepwater Gulf of Mexico, in the last 40 years and we believe we have captured 900 million barrels of oil equivalent, net on our 505,000 net acreage position in the play,” said Mark G. Papa, EOG’s Chairman and CEO.
Enterprise will build a 140-mile pipeline originating in northwestern Karnes County to transport EOG’s crude oil production from the Eagle Ford Shale. The pipeline will extend to its existing crude oil system in Austin County where it will connect to the partnership’s Sealy Station. The pipeline, which is anchored by a 10-year, firm transportation agreement with EOG, offers the flexibility to access the Houston refinery market or the Enterprise-operated Seaway Pipeline system that provides a direct link to Cushing, OK. With a capacity of 350,000 bpd, the crude oil pipeline will be large enough not only to meet EOG’s requirements, but to accommodate other Eagle Ford producers.
Enterprise plans to build central delivery points for receiving crude oil from trucks and gathering pipelines at multiple locations along the crude oil pipeline route. Completion of the crude oil pipeline project is expected in early 2012. Enterprise will also provide firm natural gas transportation and processing, as well as NGL transportation and fractionation services to EOG. Enterprise will build 52 miles of additional pipeline laterals to complement its previously announced Eagle Ford rich natural gas mainline project.