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Released February 22, 2019 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Like other midstream companies, Energy Transfer LP (NYSE:ET) (Dallas, Texas) is benefitting from record production of oil, natural gas and natural gas liquids (NGLs) in the U.S. After the merger of Energy Transfer Partners and Energy Transfer Equity in October, the new Energy Transfer reported full-year 2018 net income of $1.69 billion, compared with $954 million in 2017. During the year, the company completed several growth projects and is progressing with several more. In the company's fourth-quarter 2018 earnings conference call, Chief Financial Officer Tom Long said Energy Transfer expects to invest approximately $5 billion on organic growth projects in 2019.
In the conference, Long also spoke about some of the company's current and recently completed projects, including two of its largest, the Mariner East 2 (ME2) and Mariner East 2X NGL pipelines in Pennsylvania. Long said, "Starting with ME2 and 2X, I am pleased to say that we placed the initial capacity of ME2 into service on December 29, 2018. Volumes are ramping up on the pipe, and we expect to be running at capacity in the near future. On ME2X, 99% of the mainline construction is complete, and at this time, we continue to target having the pipeline in service by late 2019." Construction on the pipelines began in early 2017. They will transport 272,750 barrels per day (BBL/d) of ethane, butane and propane from the Utica and Marcellus shales. For more information, see Industrial Info's project report.
In addition to pipelines, Energy Transfer continues adding NGL fractionation capacity to its Lone Star facility in Mont Belvieu, Texas, where it recently completed construction of a sixth fractionator (frac). Long said, "Turning to Frac 6, we are pleased to announce that this 150,000-BBL/d fractionator went into service earlier this week and is expected to be running at full capacity early in the second quarter. In November 2018, we announced plans to construct our seventh Lone Star fractionator. Frac 7 will have a capacity of 150,000 BBL/d and is fully subscribed under long-term, demand-based agreements. It is expected to be in service in the first quarter of 2020." Frac 7 will bring Energy Transfer's total fractionation capacity at the Lone Star facility to 900,000 BBL/d. Construction began late last year, with S&B Engineers and Constructors Limited (Houston, Texas) providing engineering, procurement and construction (EPC). For more information, see Industrial Info's project report. "We continue to evaluate further expansion of frac capacity due to the strong demand of customers," said Long.
The increased fractionation capacity is leading to other projects. Long said, "To accommodate this growth, we previously announced the 24-inch, 352-mile Long Star Express expansion, which will add approximately 400,000 BBL/d of NGL pipeline capacity from Lone Star's pipeline system near Wink, Texas, to the Lone Star Express 30-inch pipeline south of Fort Worth, Texas, and is expected to be in service in the fourth quarter of 2020." Construction on the expansion is expected to begin later this year. The project has an estimated total investment value of $750 million. For more information, see Industrial Info's project report.
Long also spoke about the company's Bayou Bridge crude oil pipeline, running from Texas to Louisiana. He said, "We are nearing completion of construction on the 24-inch segment from Lake Charles to Saint James [Louisiana] and expect commercial operations to begin in March." This second phase of the pipeline has a length of 162 miles and will transport 280,000 BBL/d. For more information, see Industrial Info's project report.
Long said, "Looking at our processing plants in West Texas ... the 200 million-cubic-foot-per-day Arrowhead II cryo[genic] plant went into service at the end of October and is nearly full. During the fourth quarter, we approved Arrowhead III, another 200 [million-foot]-a-day] processing plant in the Delaware Basin. We're thoughtfully adding plants to meet producer demand, and Arrowhead III is expected to be in service in the third quarter of 2019." Construction on the plant began early last year, and when completed, will bring the Arrowhead facility's total natural gas processing capacity to 600 million cubic feet per day. For more information, see Industrial Info's project report.
The company has further plans for processing capacity in the Delaware and Permian basins. Long said, "We are seeing continued demand and expect to announce another processing plant in the Permian Basin shortly. This plant will be in service in 2020 and is already fully subscribed."
Energy Transfer also is constructing the Revolution cryogenic natural gas processing plant near Bulger, Pennsylvania. Construction began in 2016 and is expected to wrap up next quarter. The plant will have a processing capacity of 440 million cubic feet per day. For more information, see Industrial Info's project report.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
In the conference, Long also spoke about some of the company's current and recently completed projects, including two of its largest, the Mariner East 2 (ME2) and Mariner East 2X NGL pipelines in Pennsylvania. Long said, "Starting with ME2 and 2X, I am pleased to say that we placed the initial capacity of ME2 into service on December 29, 2018. Volumes are ramping up on the pipe, and we expect to be running at capacity in the near future. On ME2X, 99% of the mainline construction is complete, and at this time, we continue to target having the pipeline in service by late 2019." Construction on the pipelines began in early 2017. They will transport 272,750 barrels per day (BBL/d) of ethane, butane and propane from the Utica and Marcellus shales. For more information, see Industrial Info's project report.
In addition to pipelines, Energy Transfer continues adding NGL fractionation capacity to its Lone Star facility in Mont Belvieu, Texas, where it recently completed construction of a sixth fractionator (frac). Long said, "Turning to Frac 6, we are pleased to announce that this 150,000-BBL/d fractionator went into service earlier this week and is expected to be running at full capacity early in the second quarter. In November 2018, we announced plans to construct our seventh Lone Star fractionator. Frac 7 will have a capacity of 150,000 BBL/d and is fully subscribed under long-term, demand-based agreements. It is expected to be in service in the first quarter of 2020." Frac 7 will bring Energy Transfer's total fractionation capacity at the Lone Star facility to 900,000 BBL/d. Construction began late last year, with S&B Engineers and Constructors Limited (Houston, Texas) providing engineering, procurement and construction (EPC). For more information, see Industrial Info's project report. "We continue to evaluate further expansion of frac capacity due to the strong demand of customers," said Long.
The increased fractionation capacity is leading to other projects. Long said, "To accommodate this growth, we previously announced the 24-inch, 352-mile Long Star Express expansion, which will add approximately 400,000 BBL/d of NGL pipeline capacity from Lone Star's pipeline system near Wink, Texas, to the Lone Star Express 30-inch pipeline south of Fort Worth, Texas, and is expected to be in service in the fourth quarter of 2020." Construction on the expansion is expected to begin later this year. The project has an estimated total investment value of $750 million. For more information, see Industrial Info's project report.
Long also spoke about the company's Bayou Bridge crude oil pipeline, running from Texas to Louisiana. He said, "We are nearing completion of construction on the 24-inch segment from Lake Charles to Saint James [Louisiana] and expect commercial operations to begin in March." This second phase of the pipeline has a length of 162 miles and will transport 280,000 BBL/d. For more information, see Industrial Info's project report.
Long said, "Looking at our processing plants in West Texas ... the 200 million-cubic-foot-per-day Arrowhead II cryo[genic] plant went into service at the end of October and is nearly full. During the fourth quarter, we approved Arrowhead III, another 200 [million-foot]-a-day] processing plant in the Delaware Basin. We're thoughtfully adding plants to meet producer demand, and Arrowhead III is expected to be in service in the third quarter of 2019." Construction on the plant began early last year, and when completed, will bring the Arrowhead facility's total natural gas processing capacity to 600 million cubic feet per day. For more information, see Industrial Info's project report.
The company has further plans for processing capacity in the Delaware and Permian basins. Long said, "We are seeing continued demand and expect to announce another processing plant in the Permian Basin shortly. This plant will be in service in 2020 and is already fully subscribed."
Energy Transfer also is constructing the Revolution cryogenic natural gas processing plant near Bulger, Pennsylvania. Construction began in 2016 and is expected to wrap up next quarter. The plant will have a processing capacity of 440 million cubic feet per day. For more information, see Industrial Info's project report.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
