Enterprise Product Partners announced the acquisition of a 37-acre tract next door to the company's Enterprise Crude Houston (ECHO) oil terminal and plans to expand storage capacity to 6 million barrels. The expansion will be completed just in time to begin receiving crude from Enterprise's 350,000 b/d Eagle Ford pipeline set for full completion in Q1 2013. The first phase of Enterprise's Eagle Ford pipeline is set to be completed in the second quarter of 2012 and the line will be fully operational by the first quarter of 2013. The expanded receipt point will also be able to receive crude from the Seaway system that is being reversed to bring crude from Cushing to the Gulf Coast and the Cameron Highway System that delivers oil from the Gulf of Mexico.
New CME Crude Contract Delivery Point
There is also potential for the storage and receipt point to become the delivery point of a new Chicago Mercantile Exchange (CME) crude oil contract. The traditional contract priced in Cushing Oklahoma, West Texas Intermediate (WTI), has come under scrutiny as differentials expanded to $10-15 less than comparable Brent crude oil prices. The new CME contract will provide an alternate trading point that is better aligned with Gulf Coast prices.
For reference, the 6 million barrels of storage at ECHO will be a little less than 10% of total storage capacity estimated in Cushing, OK.
Read the full press release at enterpriseproducts.com