Enterprise Products Partners (NYSE:EPD) announced on Wednesday its agreement to purchase stakes in Whitethorn Pipeline Company and Enterprise EF78 from Western Midstream Partners (WES) in transactions valued at $375 million in cash.
The deal involves the acquisition of Western Midstream’s 20% equity interest in Whitethorn, which possesses the 620,000 barrels per day (bbl/day) Midland-to-Sealy section of the Midland-to-ECHO 1 crude oil pipeline, as well as Western Midstream’s 25% stake in EF78. EF78 encompasses natural gas liquids fractionators 7 and 8 situated in Mont Belvieu, Texas, boasting a combined capacity of 170,000 bbl/day.
As a result, Enterprise now assumes full ownership of both assets. Additionally, Enterprise has agreed to procure Western Midstream’s 15% interest in Panola Pipeline Company for $25 million in cash. Panola Pipeline spans 253 miles and transports mixed natural gas liquids from gas processing plants in east Texas, including Enterprise’s Bulldog facility, to various endpoints, including the partnership’s NGL fractionation complex.
Key Points
- Acquisition Details: Enterprise Products Partners (EPD) has entered into agreements to acquire assets from Western Midstream Partners (WES) for a total consideration of $375 million in cash. This involves purchasing stakes in Whitethorn Pipeline Company and Enterprise EF78, as well as acquiring an interest in Panola Pipeline Company.
- Whitethorn Pipeline: EPD is acquiring Western Midstream’s 20% equity interest in Whitethorn Pipeline Company. This company owns a crucial segment of the Midland-to-ECHO 1 crude oil pipeline, enhancing EPD’s control over crucial infrastructure for transporting crude oil from Midland to Sealy, Texas.
- Enterprise EF78: EPD is also acquiring Western Midstream’s 25% stake in Enterprise EF78. This asset includes natural gas liquids fractionators 7 and 8 located in Mont Belvieu, Texas. With a combined capacity of 170,000 barrels per day, these fractionators play a key role in EPD’s natural gas liquids processing and distribution operations.
- Full Ownership: With these acquisitions, Enterprise Products Partners now owns 100% of both Whitethorn Pipeline Company and Enterprise EF78, consolidating its control over these critical assets and streamlining operational management.
- Panola Pipeline: EPD has agreed to purchase Western Midstream’s 15% interest in Panola Pipeline Company for $25 million in cash. Panola Pipeline operates a 253-mile transportation route for mixed natural gas liquids, facilitating the movement of these products from gas processing plants in east Texas to various destinations, including EPD’s NGL fractionation complex.
Overall, these acquisitions represent strategic moves by Enterprise Products Partners to expand its presence in key energy infrastructure segments, particularly in crude oil and natural gas liquids transportation and processing. The purchases align with EPD’s broader business strategy of enhancing operational efficiency and strengthening its competitive position in the energy market.
About Enterprise Products Partners
Enterprise Products Partners L.P. operates as a publicly traded partnership, with its shares listed on the New York Stock Exchange under the ticker symbol EPD. The company traces its roots back to 1968 when Dan Duncan and two associates established Enterprise Products Company, initially focusing on wholesale marketing of natural gas liquids. Presently, the company’s comprehensive energy infrastructure network delivers midstream energy solutions to both natural gas and petroleum producers as well as consumers. This network facilitates connections between major North American supply regions and markets both domestically and internationally.
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