Will Enterprise Product Partners see a major pipeline buildout?

Market Realist

Key points from Enterprise Products Partners' analyst day meeting (Part 7 of 8)

(Continued from Part 6)

Enterprise Products Partners’ plans

Enterprise Products Partners (EPD) is one of the largest midstream energy master limited partnerships (or MLPs) and a major component of the Alerian MLP ETF (AMLP). Over the next few years, EPD plans to focus most of its capex on natural gas liquids projects, given rapid NGL production growth in the U.S. Some of this NGL investment has come in the form of LPG exports (as we’ve discussed in this series), and another leg of this investment has come through the construction of major NGL pipelines.

In January, EPD began service on the Appalachia-to-Texas Express (ATEX) ethane pipeline, which benefits from surging natural gas liquids production from the Appalachian-based Marcellus and Utica shales, of which ethane is a major component. The line terminates at the Mont Belvieu natural gas liquids hub.

EPD notes in its 10-K,  ”With the addition of our Aegis Ethane Pipeline (an asset currently under construction which will deliver ethane to petrochemical plants in the Gulf Coast of TX and LA, to commence first operations in 3Q14 with other stages coming online thereafter), we will link Marcellus and Utica Shale-produced ethane to existing ethylene production facilities along the U.S. Gulf Coast and provide supply security to support construction of new third-party ethylene plants currently planned at Texas and Louisiana petrochemical facilities. Also, since our distribution system supports our LPG export terminal on the Houston Ship Channel, ethane volumes delivered to Mont Belvieu via ATEX Express may enhance the prospects for U.S.-produced ethane being exported to international markets.”

EPD also recently put into service the Front Range NGL pipeline from the Rockies to North Texas and the Texas Express NGL pipeline from North Texas towards the Gulf Coast. Front Range is a joint venture with DCP Midstream (DPM) and Anadarko (APC). Texas Express is a joint venture with Enbridge (ENB), DCP Midstream (DPM), and Anadarko (APC).

To read about Enterprise’s outlook on its natural gas business, continue on to the part of this series.

Continue to Part 8

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