Midstream energy services provider Enterprise Products Partners has signed long-term agreements that support the development of a new pipeline in the US.
The 416-mile pipeline will transport crude oil and condensate from the Enterprise's Midland terminal in Texas to its Sealy storage facility west of Houston.
From Sealy, the new pipeline will connect to the company's ECHO terminal via an interconnect with the Rancho II pipeline, which is expected to start operations in July this year.
The new pipeline, which expected to start services in the second quarter of 2017, will be capable of delivering about 540,000 barrels per day of take-away capacity for increasing volumes of crude oil, and condensate from the Permian Basin.
Trucks and pipelines will be used to collect the hydrocarbons into Enterprise's Midland terminal. They will then be delivered to Sealy in about four segregated batches.
Enterprise is adding incremental storage capacity to support the new pipeline and the existing West Texas gathering system.
Enterprise general partner chief executive officer Michael Creel said: "In addition to facilitating crude oil and condensate production from one of our most important domestic basins, the Midland-to-Sealy pipeline will provide customers with adequate supply out of the Permian Basin and unsurpassed market access to the vast Gulf Coast refining complex, as well as dock access necessary for growing export opportunities."
Enterprise currently has about $7.5bn of capital growth projects under construction, some of which will benefit customers on the new pipeline.