Enterprise Products Partners L.P. (NYSE: EPD) and Navigator Holdings
Ltd. (NYSE: NVGS) today announced the execution of a letter of intent to
jointly develop an ethylene marine export terminal on the Houston Ship
Channel. Enterprise would manage the construction, operations and
commercial activities of the proposed terminal, which would be located
at Enterprise’s Morgan’s Point complex. Enterprise’s Morgan’s Point
facility has a 45-foot draft and includes Enterprise’s ethane marine
export terminal, the world’s largest. Navigator Gas has extensive
experience with ethylene shipping through its fleet of 14
ethylene-capable vessels that provide a virtual pipeline to deliver
ethylene to consuming customers.
The ethylene export terminal would be connected to Enterprise’s
high-capacity ethylene salt dome storage and ethylene pipeline system,
which is currently under construction. Enterprise’s ethylene storage
facility will have approximately 600 million pounds of capacity with an
injection/withdrawal rate of 210,000 pounds per hour expandable to
420,000 pounds per hour. Enterprise’s ethylene pipeline system will be
connected to multiple producers and consumers of ethylene on the U.S.
Gulf Coast.
The U.S. petrochemical industry is expanding its ethylene production
capacity by 45 percent between 2016 and 2020, based on currently
announced projects. These expansions are driven by plentiful, low-cost
supplies of natural gas and ethane as a result of the development of
U.S. shale reserves. Almost 90 percent of these expansions are at
facilities located along the Texas and Louisiana Gulf Coast.
Enterprise’s ethylene storage and pipeline system, together with the
proposed ethylene export terminal, would provide the petrochemical
industry with logistical flexibility and an outlet to international
markets.
“We are very pleased to work with Navigator Gas in efforts to
commercialize an industry leading ethylene marine export terminal on the
Houston Ship Channel with unsurpassed connectivity to ethylene producers
and pipeline and storage infrastructure,” said A.J. “Jim” Teague, chief
executive officer of the general partner of Enterprise. “Customers would
have the ability to manage the transportation and storage of ethylene
supplies from the tailgate of producing facilities to domestic and
international consuming derivative plants. The proposed ethylene export
terminal would provide U.S. petrochemical companies critical market
diversification rather than relying solely on polyethylene export
markets.”
“A strategically located ethylene export terminal is the key to
unlocking growing petrochemical production capacity in the U.S. We are
proud to work with Enterprise, with their proven commercial
and technical capabilities, on a project that promises to meet the needs
of our customers and provides the seamless transportation of ethylene
from the producer to the customer,” commented David Butters, chief
executive officer of Navigator Gas.
Formation of the 50/50 joint venture to build, own and operate the
ethylene marine export terminal is subject to the negotiation and
execution of definitive agreements and approval by the respective boards
of directors of Enterprise and Navigator Holdings. The commercialization
of the project is subject to sufficient long-term customer commitments.
Enterprise Products Partners L.P. is one of the largest publicly traded
partnerships and a leading North American provider of midstream energy
services to producers and consumers of natural gas, NGLs, crude oil,
refined products and petrochemicals. Enterprise’s services include:
natural gas gathering, treating, processing, transportation and storage;
NGL transportation, fractionation, storage, and export and import
terminals; crude oil gathering, transportation, storage, export and
terminals; petrochemical and refined products transportation, storage
and terminals; and a marine transportation business that operates
primarily on the United States inland and Intracoastal Waterway systems.
The partnership’s assets include approximately 50,000 miles of
pipelines; 260 million barrels of storage capacity for NGLs, crude oil,
refined products and petrochemicals; and 14 billion cubic feet of
natural gas storage capacity.
Navigator Holdings Ltd. is the owner and operator of the world’s largest
combined fleet of handysize and midsize liquefied gas carriers,
including the largest fleet of ethylene vessels, by tonnage. Navigator
Holdings provides international and regional seaborne transportation
services of ethylene, ethane, LPG, petrochemical gases and ammonia for
energy companies, industrial users and commodity traders. Navigator
Holdings’s fleet of 38 vessels, 14 of which are the largest ethylene and
ethane-capable liquefied gas carriers available in the market, enables
cost-effective and efficient long-haul transportation of ethylene for
our customers.
This press release includes “forward-looking statements” as defined
by the Securities and Exchange Commission. All statements, other than
statements of historical fact, included herein that address activities,
events, developments or transactions that Enterprise and its general
partner and/or Navigator Gas expect, believe or anticipate will or may
occur in the future are forward-looking statements. These
forward-looking statements are subject to risks and uncertainties that
may cause actual results to differ materially from expectations,
including required approvals by regulatory agencies, the possibility
that the anticipated benefits from such activities, events, developments
or transactions cannot be fully realized, the possibility that costs or
difficulties related thereto will be greater than expected, the impact
of competition, and other risk factors included in Enterprise’s and
Navigator Gas’s respective reports filed with the Securities and
Exchange Commission. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of their dates.
Except as required by law, neither Enterprise nor Navigator Gas intends
to update or revise their respective forward-looking statements, whether
as a result of new information, future events or otherwise.
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