Shale Daily / NGI All News Access

Partners Building Eagle Ford Crude Infrastructure

NuStar Logistics LP and TexStar Midstream Services LP plan to develop a pipeline to carry Eagle Ford Shale crude oil and condensate to Corpus Christi, TX, the partners said Tuesday. They are the latest to announce projects targeting crude oil production from the South Texas play, where development activity has been brisk.

"...[T]his project is part of a larger strategy to give our customers even greater logistical flexibility by moving the crude and condensate from the Eagle Ford region to Corpus Christi, which gives them greater access to major refining and trading hub markets since Corpus Christi has waterborne capabilities for loading vessels," said NuStar CEO Curt Anastasio. "NuStar's existing pipeline and terminal infrastructure in South Texas provides the foundation to pursue and develop these and other logistics opportunities in the Eagle Ford Shale region."

TexStar is to build and operate the 65-mile, 12-inch diameter pipeline that will have the capacity to move 120,000 b/d of crude and condensate from Frio County to the town of Three Rivers in Texas. The company said it will build at least two truck unloading facilities along the pipeline to gather crude oil produced in Atascosa, Frio, LaSalle, McMullen and Live Oak counties.

At Three Rivers the TexStar pipeline is to be connected with a new storage facility to be constructed by NuStar. That facility will be connected to NuStar's existing 16-inch diameter pipeline, which will have capacity to transport 200,000 b/d into NuStar's Corpus Christi North Beach Terminal.

The North Beach terminal has 2 million bbl of storage capacity. The Port of Corpus Christi Authority recently approved a land lease option agreement for 15 acres contiguous to the existing property, which will provide terminal expansion capabilities. TexStar and NuStar expect to complete construction and begin service on the projects in the second quarter of 2012.

"Use of NuStar's existing pipeline and terminal infrastructure in Corpus Christi will assure producers of a secure and reliable solution for getting their oil to market in the near future," said TexStar CEO Phil Mezey.

The NuStar-TexStar project joins others that are targeting Eagle Ford crude production.

Magellan Midstream Partners LP and M3 Midstream LLC are developing a 180-mile pipeline originating in LaSalle and Live Oak counties and terminating in Corpus Christi to carry crude oil and condensate from the Eagle Ford to Magellan's distribution terminal in Corpus Christi. And separately Watco Cos. LLC and Kinder Morgan Energy Partners LP plan to construct and operate several rail transloading facilities to handle crude oil and energy-related products. They said the network would serve Dore and Stanley in North Dakota; Stroud, OK; Houston; and "several strategic loading facilities in the Eagle Ford Shale area in South Texas" (see Shale Daily, March 8).

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