Enterprise/Enbridge Announce Concurrent Open Seasons

January 2012, Vol. 239 No. 1

Enterprise Products Partners L.P. and Enbridge Inc. planned to hold concurrent open seasons from Jan. 4 through Feb. 10 to solicit capacity commitments from shippers for an expansion of the Seaway pipeline and an extension of the pipeline into the Port Arthur/Beaumont refining market.

Enterprise and Enbridge recently announced plans to reverse the flow direction of the 500-mile, 30-inch Seaway crude oil pipeline, enabling it to transport crude oil from the oversupplied hub in Cushing, OK to the Gulf Coast.

The initial 150,000-bpd capacity on the reversed system could be available by spring. Following pump station additions and modifications, which are expected to be completed by early 2013, capacity would increase to 400,000 bpd, assuming a mix of light and heavy grades of crude oil.

Shippers who participated in the Wrangler open season have indicated strong support for the Seaway reversal and expansion. Given the advantages associated with Seaway, Wrangler has been terminated. Depending on the results of the open season, the Seaway pipeline would be looped or twinned to create additional capacity. This new loop would be built at the size and capacity required to meet shipper needs and in a location that generally follows the route of the existing Seaway pipeline.

Mike Creel, president and CEO of Enterprise, said, “Leveraging the benefits of the existing Seaway Pipeline, which is expected to be fully contracted, provides shippers with accelerated access to the Gulf Coast refining market, while an expansion offers incremental capacity in excess of 400,000 bpd and could be available in early 2014.”

The 85-mile pipeline from Enterprise’s ECHO crude oil terminal southeast of Houston to Port Arthur will give shippers access to the region’s heavy oil refining capabilities. Service is scheduled to begin in 2014.

In another announcement, Enbridge indicated it is proceeding with its Gulf Coast Access project, which will transport crude oil from Flanagan, IL south to Cushing, OK via an additional line it will construct, and then to Houston and Port Arthur on the Seaway pipeline system joint venture. Enbridge will hold a concurrent second open season to enable shippers to subscribe for additional capacity from Flanagan all the way to the Texas Gulf Coast.

Enbridge’s $1.15 billion acquisition of an interest in Seaway from ConocoPhillips closed Dec. 20. Enterprise and Enbridge each own a 50% ownership interest in the pipeline system with Enterprise serving as operator.