Enterprise Products Partners LP announced Monday it added more El Paso Corp. properties to its portfolio with the purchase of two East Texas natural gas subsidiaries. Enterprise paid $74.5 million for the natural gas gathering system and natural gas cryogenic processing plant, and the acquisition is expected to be immediately accretive to cash flow in 2005.

According to Enterprise, the East Texas plants, located in Polk County, TX, own an 80% equity interest in three gathering systems, which represent a combined 89 miles of two-inch to 12-inch pipeline system, and a 75% equity interest in the Indian Springs gas processing facility.

The Indian Springs processing plant has capacity to process up to 120 MMcf/d. In addition, there is an idle 20 MMcf/d train available for restart to support an increase in gas volumes. The gas processed at the Indian Springs plant is sourced from the Polk County gas gathering systems, as well as the nearby Big Thicket gathering system. Big Thicket is a 240-mile pipeline system located in Tyler and Hardin counties that is owned and operated by Enterprise. Together, these gathering systems cover a significant portion of the prolific Woodbine, Wilcox and Yegua production areas in East Texas.

Additionally, the Indian Springs plant produces more than 6,000 bbl/d of natural gas liquids (NGLs) that are currently fractionated at a facility in Mont Belvieu under a contract that will expire in May 2006. Enterprise said last week that it will expand the Mont Belvieu facility (see Daily GPI, Jan. 19).

“These entities will fit very well with our core businesses of natural gas gathering and processing, and will strengthen our group of fee-based assets,” said Enterprise CEO O.S. “Dub” Andras. “We expect to create additional value from this purchase by integrating the Indian Springs and Big Thicket systems and fractionating the NGLs at our facilities in Mont Belvieu beginning in June 2006.” All required regulatory approvals have already been received.

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