Mid-America Pipeline Co. LLC has executed long-term transportation agreements with all but one of its current shippers on the Rocky Mountain Pipeline system to transport natural gas liquids (NGL) from the Rockies to either the Hobbs, NM fractionator or to Mont Belvieu, TX, via the Seminole pipeline system. The agreements, for at least 10 years and up to 20 years, are expected to help expand NGL transportation from the growing Rockies’ basins.
The agreements were completed as part of Mid-America’s open season tariff, accepted by the Federal Energy Regulatory Commission to take effect Aug. 6.
The Enterprise Products Partners LP subsidiary said one of the shipper transportation agreements is subject to further ratification by the shipper’s executive management. Based upon shipper production forecasts and current NGL extraction rates, Mid-America Pipeline expects that its current pipeline capacity of 225,000 bbl/d and its expansion capacity of 50,000 bbl/d will be fully utilized.
“The long term agreements will anchor our current expansion and positions the Mid-America Rocky Mountain system for further expansions in the future as drilling activity in the Rockies continues,” said Enterprise CEO Robert G. Phillips.
In December 2005, Enterprise announced a project to expand the transportation capacity of Mid-America’s Rocky Mountain pipeline system by 50,000 bbl/d to increase NGL production in the Rocky Mountain area. Construction of the expansion project, which began in the second quarter, is expected to be completed in phases through mid-2007. The expansion project will add 30,000 bbl/d of capacity by the end of 2006 from pipeline looping. An additional 20,000 bbl/d of capacity will be added as a result of horsepower upgrades from new pump stations that are expected to be completed in mid-2007.
Last year Enterprise announced two fractionation projects downstream of the pipeline expansion that also were designed to accommodate increased production of NGL from the Rockies. Combined, the two projects will increase the partnership’s fractionation capacity by a total of 90,000 bbl/d. The first project, completed in April, added 15,000 bbl/d of capacity to the existing NGL fractionator at Mont Belvieu. The second project, to be completed in the third quarter of 2007, is the construction of a 75,000 bbl/d NGL fractionator and related storage facilities at the interconnection of the Mid-America Pipeline and the Seminole Pipeline systems at Enterprise’s Hobbs location near the border of Texas and New Mexico.
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