NuStar Logistics LP and Velocity Midstream Partners said they are developing a pipeline to transport west Eagle Ford Shale condensate from Velocity's Gardendale Hub to NuStar's North Beach Corpus Christi, TX terminal.
"Given the steep ramp[-up] in condensate production, the western portion of the Eagle Ford Shale has an immediate need for transportation solutions to the Gulf Coast markets," said Velocity Midstream President Rick Wilkerson. "Given the difficult trucking conditions, it is the next 18-24 months that our customers are most concerned about. Several crude oil projects have been announced and will be needed [see Shale Daily, April 12]; however, the Velocity-NuStar system will offer producers a near-term solution for transportation of condensate directly to Corpus Christi markets and other markets accessible from Corpus Christi."
Velocity said it will build and operate a 70-mile, 12-inch diameter pipeline with capacity to carry 100,000 b/d of condensate from Gardendale to Oakville, TX. The pipeline would interconnect with NuStar's new Oakville Storage Facility near Three Rivers, TX. The storage facility would be connected to NuStar's existing 16-inch diameter pipeline, which has capacity to transport 200,000 b/d of crude and condensate into NuStar's North Beach terminal.
The North Beach terminal has two million barrels of storage capacity, large-scale marine loading facilities and access to several Corpus Christi refinery markets.
Velocity is currently constructing 65 miles of pipeline and 150,000 bbl of storage to transport condensate to Velocity's Gardendale Terminal for producers, including Shell Exploration & Production, Chesapeake Energy, SM Energy and Rosetta Resources (see Shale Daily, May 19). "The addition of the NuStar partnership allows Velocity to quickly offer these and other producers a downstream solution to transport condensate from the Gardendale Terminal to end markets with strong purchaser demand," Velocity Midstream said.
Construction of Velocity's 12-inch diameter pipeline and NuStar's Three Rivers storage facility are to begin this summer; the system is expected to be in service by April.