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Researched by Industrial Info Resources (Sugar Land, Texas)--Midstream operator Enterprise Products Partners LP (NYSE:EPD) (Houston, Texas) seemed to have a good third quarter. While not a huge lift, the company boosted its third-quarter 2020 net income to $1.08 billion from $1.05 billion in third-quarter 2019. Although Enterprise has faced impacts from COVID-19 on some of its projects, it has cancelled only one major planned project due to market conditions and is progressing with projects in its pipelines, fractionation and petrochemical sectors.
In the company's earnings conference call, Co-Chief Executive Officer Randy Fowler said Enterprise had placed $1.4 billion in projects in service since the last earnings call and had another $1.4 billion under construction.
Despite cancelling its Midland-to-ECHO IV crude oil pipeline in Texas, Enterprise still is moving forward with the preceding Midland-to-ECHO III pipeline, a 502-mile line that will carry 400,000 to 450,000 barrels per day (BBL/d) of crude oil from Enterprise's terminal in Midland, Texas, to its Sealy storage facility near Houston. Construction kicked off earlier this year and is expected to wrap up soon. For more information, see Industrial Info's project reports on Midland-to-ECHO III and Midland-to-ECHO IV.
Enterprise also is making headway in the petrochemical sector. The other co-chief executive officer, Jim Teague, said Enterprise had seen strong demand for both ethylene and propylene, which is used in the manufacture of personal protective equipment. "We're easily the largest midstream player in generating, consuming and marketing hydrogen from processes in our petrochemical plants, specifically IBDH [isobutane dehydrogenation] and PDH [propane dehydrogenation]," Teague said. "We estimate that with the completion of our second PDH facility in 2023, we will produce about 150 million cubic feet of hydrogen, something over 100 million of pure hydrogen. We use all the hydrogen we can in our plants, and we sell the rest into the industrial gas market."
The start of construction on Enterprise's second PDH unit in Mont Belvieu, Texas, was pushed out a bit due to the COVID-19 pandemic but is now underway. The unit will double the Mont Belvieu facility's PDH capacity from 1.65 billion pounds per year of propylene to 3.3 billion pounds, using 70,000 BBL/d of propane as feedstock. For more information, see Industrial Info's project report.
While companies such as ONEOK Incorporated (NYSE:OKE) (Tulsa, Oklahoma) and Phillips 66 (NYSE:PSX) (Houston, Texas) have delayed or halted natural gas liquids (NGLs) fractionation projects, Enterprise is plowing ahead with two fractionators at Mont Belvieu, both of which began construction in 2019. Each fractionator will add 150,000 BBL/d of capacity, bringing total capacity to 1.25 million BBL/d. Construction on Frac 11 is wrapping up, and Frac 12 is expected to be completed early next year. S&B Engineers & Constructors Limited (Houston) is providing engineering, procurement and construction services on both units. For more information, see Industrial Info's project reports on Frac 11 and Frac 12.
Fowler said Enterprise made $705 million in capital expenditures (capex) in the third quarter, including $226 for sustaining capital, and anticipated a total of $3.2 billion in capex for 2020. The company's capex is on a downward trajectory, as Fowler said anticipated capex in 2021 was $1.6 billion, followed by $800 million in 2022.
However, this could perhaps be given a boost with certain government regulatory approvals. "Our capital expenditure forecast excludes our proposed SPOT offshore crude terminal that is subject to government approvals, which we do not expect to receive this year," Fowler said. The $1.5 billion terminal would be built approximately 30 to 35 miles off the coast of Brazoria County, Texas, in water depths of about 115 feet, and would be capable of loading and exporting crude oil in very large crude carriers (VLCCs) via a pipeline running from an onshore terminal. The project likely remains a few years out. 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 company's earnings conference call, Co-Chief Executive Officer Randy Fowler said Enterprise had placed $1.4 billion in projects in service since the last earnings call and had another $1.4 billion under construction.
Despite cancelling its Midland-to-ECHO IV crude oil pipeline in Texas, Enterprise still is moving forward with the preceding Midland-to-ECHO III pipeline, a 502-mile line that will carry 400,000 to 450,000 barrels per day (BBL/d) of crude oil from Enterprise's terminal in Midland, Texas, to its Sealy storage facility near Houston. Construction kicked off earlier this year and is expected to wrap up soon. For more information, see Industrial Info's project reports on Midland-to-ECHO III and Midland-to-ECHO IV.
Enterprise also is making headway in the petrochemical sector. The other co-chief executive officer, Jim Teague, said Enterprise had seen strong demand for both ethylene and propylene, which is used in the manufacture of personal protective equipment. "We're easily the largest midstream player in generating, consuming and marketing hydrogen from processes in our petrochemical plants, specifically IBDH [isobutane dehydrogenation] and PDH [propane dehydrogenation]," Teague said. "We estimate that with the completion of our second PDH facility in 2023, we will produce about 150 million cubic feet of hydrogen, something over 100 million of pure hydrogen. We use all the hydrogen we can in our plants, and we sell the rest into the industrial gas market."
The start of construction on Enterprise's second PDH unit in Mont Belvieu, Texas, was pushed out a bit due to the COVID-19 pandemic but is now underway. The unit will double the Mont Belvieu facility's PDH capacity from 1.65 billion pounds per year of propylene to 3.3 billion pounds, using 70,000 BBL/d of propane as feedstock. For more information, see Industrial Info's project report.
While companies such as ONEOK Incorporated (NYSE:OKE) (Tulsa, Oklahoma) and Phillips 66 (NYSE:PSX) (Houston, Texas) have delayed or halted natural gas liquids (NGLs) fractionation projects, Enterprise is plowing ahead with two fractionators at Mont Belvieu, both of which began construction in 2019. Each fractionator will add 150,000 BBL/d of capacity, bringing total capacity to 1.25 million BBL/d. Construction on Frac 11 is wrapping up, and Frac 12 is expected to be completed early next year. S&B Engineers & Constructors Limited (Houston) is providing engineering, procurement and construction services on both units. For more information, see Industrial Info's project reports on Frac 11 and Frac 12.
Fowler said Enterprise made $705 million in capital expenditures (capex) in the third quarter, including $226 for sustaining capital, and anticipated a total of $3.2 billion in capex for 2020. The company's capex is on a downward trajectory, as Fowler said anticipated capex in 2021 was $1.6 billion, followed by $800 million in 2022.
However, this could perhaps be given a boost with certain government regulatory approvals. "Our capital expenditure forecast excludes our proposed SPOT offshore crude terminal that is subject to government approvals, which we do not expect to receive this year," Fowler said. The $1.5 billion terminal would be built approximately 30 to 35 miles off the coast of Brazoria County, Texas, in water depths of about 115 feet, and would be capable of loading and exporting crude oil in very large crude carriers (VLCCs) via a pipeline running from an onshore terminal. The project likely remains a few years out. 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.
