In another casualty of the oil market downturn, Enterprise Products Partners LP has scrapped an expansion of the Midland-to-ECHO (M2E4) pipeline to move oil supply from the Permian Basin to the Gulf Coast, which was set to begin initial operations this month.

Instead, the Houston-based midstream company has entered into amended agreements with some customers to reduce near-term volume commitments in exchange for extending the term of the contracts. The so-called “win-win solution” allows customers and Enterprise to “better allocate capital during the challenging times of the current economic cycle while retaining long-term, fee-based volumes and revenues for our assets,” according to Co-CEO Jim Teague.

The M2E4 project would have added an initial 450,000 b/d, with a...