Seaway oil pipeline to be reversed from Cushing to Texas Gulf coast

16 November 2011 15:31  [Source: ICIS news]

HOUSTON (ICIS)--Enbridge and Enterprise Products have agreed to reverse the direction of flows on the Seaway oil pipeline to go from Cushing, Oklahoma, to the Texas Gulf coast, the energy logistics and services firms said on Wednesday.

The reversal of the 500-mile (805km) pipeline would offer Texas Gulf coast refiners secure and reliable oil supplies of oil, replacing imported crude. At the same time, the project would provide an outlet for Cushing crude, which is priced at a discount to imported crude oil.

Pending regulatory approval, the line could operate in reverse direction – from Cushing to the Gulf coast – with an initial capacity of 150,000 bbl/day by the second quarter of 2012, Enbridge and Enterprise said.

Following pump station additions and modifications, which are expected to be completed by early 2013, the capacity of the reversed Seaway pipeline will be up to 400,000 bbl/day. The total costs of the reversal project are estimated at about $300m (€222m).

The agreement between Enbridge and Enterprise comes on the back of a deal on Wednesday under which Enbridge will acquire ConocoPhillips’ 50% interest in the Seaway crude pipeline system for $1.15bn.

In September, Enbridge and Enterprise had announced plans to build an 800km pipeline with an initial capacity of 800,000 bbl/day from the Cushing oil hub to the US Gulf coast in Texas.

In their statement on Wednesday, the companies did not say if or how the proposed Seaway pipeline reversal would affect their plans for a new pipeline. Company media officials were not immediately available for additional comment.

($1 = €0.74)

By: Stefan Baumgarten
+1 713 525 2653

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