Enterprise Products Partners plans to add storage capacity at a Houston oil terminal pegged as the delivery point for a proposed new crude contract by CME Group aimed at countering criticism of the current U.S. benchmark, Reuters reports. Enterprise has purchased land adjacent to the Enterprise Crude Houston (ECHO) terminal, expected to be completed in the second quarter of 2012, to allow for crude storage of around 6 million barrels, the company said in a press release on Monday.
Interest in ECHO has grown since CME Group Inc said it would consider launching a new Gulf Coast crude futures contract late last year after its West Texas Intermediate contract -- the benchmark for U.S. crude -- drew criticism for reflecting market conditions surrounding the landlocked Cushing, Oklahoma delivery point.
Enterprise is joint owner along with Canada's Enbridge Corp of the Seaway crude oil pipeline, which will be reversed in June. This looks to be the first project on line of several designed to alleviate the Cushing oil glut.
The reversal will initially be able to carry about 150,000 bpd of crude out of Cushing and down to the Gulf Coast, ramping up to be able to carry 500,000 bpd of growing volumes of Canadian, Bakken, and West Texas crudes to the sea.
Enterprise said in December it would start building three tanks with 750,000 barrels of crude, to be expanded to 4.5 million barrels at ECHO. Cushing has capacity to store over 65 million barrels of crude, according to energy data provider Genscape.
"We see this as a comprehensive solution," said Rick Rainey, spokesman for Enterprise Products Partners.
"Shippers will be able to reach the entire Gulf Coast refining complex."
ECHO will be able to get crude from several different places including South Texas, West Texas, the Bakken shale oil play in North Dakota, Canada as well as oil from the deepwater Gulf of Mexico via the Cameron Highway System (CHOPS).
ECHO's initial storage will dedicated to the light, sweet South Texas Eagle Ford shale crude oil coming through its 350,000 bpd pipeline. Rainey said that the pipeline completion and initial volumes will also be in the second quarter of 2012.
Enterprise has 90 percent of the capacity - about 330,000 bpl -- under shipper commitment.
Phase II of the Eagle Ford pipeline project will come online during the first quarter of 2013 with an additional 200,000 bpd capacity. Rainey said there were some commitments on that portion of the line as well.
At Sealy, Texas the line will link up with Enterprise's Rancho line that runs to southeast Houston and the ECHO site.
Rainey said the company had not released the timeline for completion of the 1.5 million barrel expansion. It also did not release the level of commitment.
Interest in ECHO has grown since CME Group Inc said it would consider launching a new Gulf Coast crude futures contract late last year after its West Texas Intermediate contract -- the benchmark for U.S. crude -- drew criticism for reflecting market conditions surrounding the landlocked Cushing, Oklahoma delivery point.
Enterprise is joint owner along with Canada's Enbridge Corp of the Seaway crude oil pipeline, which will be reversed in June. This looks to be the first project on line of several designed to alleviate the Cushing oil glut.
The reversal will initially be able to carry about 150,000 bpd of crude out of Cushing and down to the Gulf Coast, ramping up to be able to carry 500,000 bpd of growing volumes of Canadian, Bakken, and West Texas crudes to the sea.
Enterprise said in December it would start building three tanks with 750,000 barrels of crude, to be expanded to 4.5 million barrels at ECHO. Cushing has capacity to store over 65 million barrels of crude, according to energy data provider Genscape.
"We see this as a comprehensive solution," said Rick Rainey, spokesman for Enterprise Products Partners.
"Shippers will be able to reach the entire Gulf Coast refining complex."
ECHO will be able to get crude from several different places including South Texas, West Texas, the Bakken shale oil play in North Dakota, Canada as well as oil from the deepwater Gulf of Mexico via the Cameron Highway System (CHOPS).
ECHO's initial storage will dedicated to the light, sweet South Texas Eagle Ford shale crude oil coming through its 350,000 bpd pipeline. Rainey said that the pipeline completion and initial volumes will also be in the second quarter of 2012.
Enterprise has 90 percent of the capacity - about 330,000 bpl -- under shipper commitment.
Phase II of the Eagle Ford pipeline project will come online during the first quarter of 2013 with an additional 200,000 bpd capacity. Rainey said there were some commitments on that portion of the line as well.
At Sealy, Texas the line will link up with Enterprise's Rancho line that runs to southeast Houston and the ECHO site.
Rainey said the company had not released the timeline for completion of the 1.5 million barrel expansion. It also did not release the level of commitment.