TexStar Is Building An Eagle Ford Pipeline From Karnes to San Antonio for Calumet

Calumet Products San Antonio Refinery

TexStar Midstream has signed an agreement with Calumet Specialty Products Partners to construct, own, and operate a 30,000 b/d pipeline system that will deliver Eagle Ford crude to Calumet's San Antonio Refinery.

The deal includes a 15-year agreement for TexStar to build and operate the Karnes North Pipeline System (KNPS). The system will include 50-miles of 8-inch pipe from Karnes to the southeast side of San Antonio.

Also Read:NuStar Buying Eagle Ford Midstream Assets - Selling San Antonio Refinery to Calumet

Calumet expects its refinery in Elmendor, TX, will receive deliveries of at least 10,000 b/d, with the potential for more. The company's San Antonio Refinery has capacity to process 14,500 b/d. Capacity is expected to grow to 17,500 b/d soon. The company spent $9 million to increase production of jet fuel, diesel, and gasoline.

“We expect this agreement will help to further improve the long-term profitability of our San Antonio refinery,” stated Jennifer Straumins, COO of Calumet. “By year-end 2014, the refinery will begin receiving significant volumes of Eagle Ford crude oil via the TexStar line, thereby enabling us to realize significant transportation cost savings on our delivered feedstock.”

The Calumet refinery produces ultra-low sulfur diesel, jet fuel, and specialty solvents.

Currently, crude oil is delivered by truck and Calumet expects the pipeline to significantly reduce the cost of delivered oil.

Read the full press release at calumetspecialty.com

Valero Investing to Handle More Eagle Ford Oil & Other Light Crude

Valero Corpus Christi and Houston Refinery Throughput

Valero Energy plans to increase its light oil processing capacity at its Gulf Coast refineries by adding topping units at Houston and Corpus Christi locations.

The investments will allow the company to process more Eagle Ford oil than possible today.

Valero will add a 90,000 b/d topping unit at its Houston refinery and a 70,000 b/d topping unit at one of the company's Corpus Christi refineries. The company expects returns of greater than 30% (IRRs) for the two investments.

Valero has two plants with total refining capacity of 325,000 b/d in Corpus Christi and the company's Houston refinery has total capacity of 160,000 b/d.

Running lighter crude will help maximize the production of gasoline and diesel.

Valero is also expanding its McKee crude unit in North Texas by 25,000 b/d in 2015 and is evaluating projects at both its Port Arthur and Meraux refineries.

With continued growth in West Texas plays, the Bakken in North Dakota, and the Eagle Ford, refineries will continue making investments to ensure they are processing the maximum volume of lower priced domestic crude.

See the full presentation at valero.com

Eagle Ford Crude to Canada? - Valero Gets Approval

Valero Quebec City Refinery

Valero received US Department of Commerce approval to ship Eagle Ford crude oil to a refinery in Quebec City, Canada. A shipment has yet to set sail, but the company expects it could save $1-2 per barrel by utilizing Gulf Coast (Eagle Ford) volumes versus crude shipped across the Atlantic.

The Department of Commerce permit was approved in November and is good for 12 months. The permit restricts exports to Eastern Canada. Valero has not indicated when it will begin making shipments to the Quebec refinery from the Gulf Coast.

Read the full article at bloomberg.com

NuStar - ConocoPhillips Ink Midstream Deal - Expanding Crude System

NuStar - ConocoPhillips Pipeline and Terminal Expansion

NuStar Energy and ConocoPhillips have agreed to a long-term pipeline and terminal services agreement that is supporting expansion of NuStar's crude oil pipeline system in the Eagle Ford.

Nustar plans to expand its pipeline system and add a 100,000 b/d terminal in Pawnee, TX. The new terminal will connect to an existing 12-inch pipeline that moves crude from Pettus to Three Rivers. From there, the pipeline will be extended to an existing Oakville Terminal for delivery to the company's North Beach Terminal. New truck receiving facilities in Pawnee and Oakville are planned, along with new refinery connections in Corpus Christi.

NuStar Announced a $425 Million South Texas Acquisition from TexStar Midstream just a month earlier.

Curt Anastasio, CEO of NuStar commented: “This expansion, backed by major producers like ConocoPhillips, cements NuStar’s position as a key logistics provider for Eagle Ford Shale play. We are fortunate to have extensive pipeline and terminal assets already in operation throughout the region with the capacity to easily support an expansion of this size and help support the incredible production growth taking place in the Eagle Ford Shale play.”

A new ship dock in Corpus Christi is already under construction. The private dock will give NuStar access to waterborne markets.

Pipeline expansions are expected to be completed in the fourth quarter of 2013 and the dock facility will be finished in the first quarter of 2014. Total costs for the Conoco supported expansions is estimated at $100-120 million.

Kinder Morgan & Phillips 66 Eagle Ford Crude Delivery Deal to Supply Sweeny Refinery

Sweeny TX Refinery Phillips 66

Kinder Morgan (KMP) and Phillips 66 have reached an Eagle Ford crude delivery deal. KMP will build a 12-inch, 27 mile lateral from its Eagle Ford Crude Condensate pipeline to Phillips 66's Sweeney Refinery in Brazoria County.

Phillips is committing to take a "significant portion" of the pipeline's initial 30,000 b/d of capacity. The pipeline will have the potential to be expanded to 100,000 b/d if needed.

KMP will invest approximately $90 million in the project, which also involves adding associated receipt facilities by constructing a five-bay truck offloading facility and three new storage tanks with approximately 360,000 barrels of crude/condensate capacity at Kinder Morgan’s DeWitt Station in DeWitt County, Texas, and Wharton Pump Station in Wharton County, Texas. Pending receipt of environmental and regulatory approvals, construction is scheduled to begin in the fourth quarter of 2012.

Kinder Morgan's Eagle Ford Crude Condensate pipeline was brought online in June of 2012.

Read the full press release at kindermorgan.com