NGI The Weekly Gas Market Report
Enterprise Products Partners L.P. reported Monday that itsoperating subsidiary has acquired ownership interests in five naturalgas pipeline systems and related assets in the central Gulf of Mexicofrom El Paso Energy Partners, L.P. for $112 million in cash. The ElPaso unit was forced to sell the assets as part of the Federal TradeCommission’s approval of the El Paso Energy/Coastal Corp. merger,which was completed Monday as well (see Daily GPI, Jan. 30).
The five systems have 725 miles of pipeline with a combinedcapacity of 2.85 Bcf/d of gas. Included in the purchase, Enterprisereceived Sailfish Pipeline L.L.C. and Moray Pipeline L.L.C.Sailfish owns a 25.67% interest in the Manta Ray Offshore GatheringCo., L.L.C. as well as the Nautilus Pipeline Co. L.L.C. Moray ownsa 33.92% interest in Nemo Gathering Co. L.L.C.
Both the Manta Ray and Nautilus Pipeline systems are jointlyowned with Shell Gas Transmission (SGT) and Marathon GasTransmission. Manta Ray is comprised of 225 miles of unregulatednatural gas pipelines with a capacity of 750 MMcf/d, while Nautilusis a 101-mile regulated line with a capacity of 600 MMcf/d. TheNemo joint project with SGT is a 24-mile gas pipeline, whichconnects Shell’s Brutus and Glider deepwater projects to the MantaRay gathering system. Nemo is expected to be complete during thefourth quarter 2001.
“This transaction significantly expands our natural gas pipelinebase of assets to include some of the most attractive pipelines inthe central Gulf and integrates well with our onshore natural gasliquid system and the Acadian Gas system,” stated O.S. “Dub”Andras, CEO of Enterprise. “These pipeline systems are eachstrategically located in the Gulf to link many of the new, highlyprolific deepwater developments to a number of onshore interstateand intrastate pipeline systems that serve multiple end use marketsthroughout the United States.”
Enterprise and SGT also teamed up to form Starfish Pipeline Co.L.L.C., which acquired Stingray Pipeline Co. L.L.C. and WestCameron Dehydration Co., L.L.C. from an affiliate of El Paso EnergyPartners. The ownership of Starfish is 50-50, butÿSGT will serve asthe operator and commercial manager of the assets. Stingray is a325-mile pipeline that transports natural gas and injectedcondensate from about 53 fields in the High Island, West Cameron,East Cameron, Vermilion and Garden Banks areas to onshoreinterstate and intrastate pipelines in Cameron Parish, LA.
Shell Gas Transmission said the addition of the Stingraypipeline, with a capacity of 1.2 Bcf/d, will boost the pipelinecapacity under its commercial management to about 7.1 Bcf/d.
“Purchase of the Stingray pipeline and its related onshoredehydration facility supports our strategy to be positioned toprovide the necessary pipeline infrastructure to support increasedGulf of Mexico deepwater natural gas production,” said Doug Krenz,president of SGT. “Shell Gas Transmission is well positioned toprovide natural gas transport services to producers in all majorGulf of Mexico production areas, particularly the highly prolificdeepwater areas.”
The West Cameron dehydration facility has a capacity of 950MMcf/d and is located at an onshore terminus of Stingray. Alsoincluded in the transaction are 17 laterals spanning approximately53 miles that are attached to Stingray, which are in the process ofbeing acquired from Natural Gas Pipeline Company of America.
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