Enterprise Products Partners L.P. announced March 22 it has entered into a 10-year agreement with two producers in the Eagle Ford Shale play of South Texas to provide firm crude oil transportation and marketing services.
The transaction represents a commitment of 50,000 barrels per day (BPD) of capacity on the new 140-mile, 24-inch diameter crude oil pipeline being constructed by Enterprise. Scheduled to begin service in the second quarter of 2012, the pipeline has a capacity of 350,000 BPD and will offer shippers the flexibility to access major storage hubs and refining centers.
“This agreement marks our third major crude oil transportation deal with Eagle Ford Shale producers in less than a year,” said A.J. “Jim” Teague, Enterprise executive vice president and chief operating officer. “More than half of the available capacity on our new pipeline is already under commitment for the next 10 years as producers have clearly come to recognize the value our integrated midstream network provides them in maximizing the value of their growing crude oil output. The demand for our services remains brisk and we are currently in discussions with other producers for additional long-term commitments.”
Approximately 150 rigs are presently working in the Eagle Ford Shale, which have drilled more than 500 wells. Current production from the play is approximately 80,000 BPD of crude oil and condensate.