Enterprise Products Operating LLC said Wednesday it signed the largest natural gas liquids (NGL) fractionation deal of its kind, nabbing a six-year agreement to provide Anadarko Energy Services Co. with services at the Mont Belvieu, TX, complex.
Under terms of the contract, the Enterprise Products Partners LP subsidiary will make up to 62,000 b/d of firm NGL fractionation capacity available at the partnership’s complex beginning Sept. 1.
“This is our single largest fractionation agreement in the history of the partnership,” said Enterprise Chief Commercial Officer Jim Teague. “This agreement serves as yet another example of the strategic importance of our Mont Belvieu hub and NGL pipeline infrastructure in providing producers in prolific basins in the western United States with vital, value-added midstream services and enhancing the options available to them through our integrated value chain.”
The contract enables Enterprise to add long-term NGL supply of more than 100,000 b/d this year, Teague noted.
“To accommodate this demand, Enterprise previously announced the construction of a new fractionator that is expected to be in service in the first quarter of 2011, which will increase the partnership’s NGL fractionation capacity at Mont Belvieu from 230,000 b/d to 305,000 b/d.”
The largest of its kind in North America, Enterprise’s Mont Belvieu NGL fractionation complex has access to the largest concentration of refineries and petrochemical plants in the world along the Gulf Coast of Texas. The storage facilities include 34 multi-product underground storage caverns with more than 100 million barrels of NGL, petrochemical and refined products capacity.
Last month during a conference call Enterprise CEO Michael Creel said the partnership would be “taking a little more holistic approach” for its NGL services (see Daily GPI, April 28).
“It’s not just a matter of extracting the NGLs and shipping them to a point,” Creel said. “You’ve got to have a market that really needs it; otherwise the netback price to the producers is pretty underwhelming. We’re really looking for an industrywide solution that takes care of the producers.”
Anadarko Petroleum Corp., which has been building its production operations both onshore and offshore, recently has focused more of its attention on the Eagle Ford Shale in South Texas, an area with a rich liquids mix of natural gas and oil.
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