Energy Transfer Rolls Out the Projects

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Researched by Industrial Info Resources (Sugar Land, Texas)--While Oil & Gas midstream companies have had their share of headaches this year, Energy Transfer LP (NYSE:ET) (Dallas, Texas) has put its eggs in more than one basket and seems to be weathering the storm of 2020 somewhat the better for it, although the company did report a quarterly net loss due to non-cash impairments of goodwill and joint venture investments. In addition to pipelines, the company is rolling out a range of projects, including fractionation and terminal facilities.

In the company's recent third-quarter earnings conference call, Chief Financial Officer Tom Long discussed some of the company's recently completed and underway projects, starting with Energy Transfer's increasing fractionation capacity. "Our fractionation volumes ... reached a new high during the quarter due to an additional ramp-up of volumes on Frac 7, which went into service earlier this year," he said.

Construction on Fractionator 7 at Energy Transfer's complex in Mont Belvieu, Texas, began in 2018. The 150,000-barrel-per-day (BBL/d) natural gas liquids (NGL) fractionator brings the facility's total processing capacity to 900,000 BBL/d. Products will include butane, propane, iso-butane, natural gasoline and ethane. S&B Engineers and Constructors Limited (Houston, Texas) provided engineering, procurement and construction (EPC) services. For more information, see Industrial Info's project report.

An eighth fractionator is under construction at Mont Belvieu, which originally was planned to be completed next summer. However, the completion date has been pushed into 2022 as Energy Transfer deemed that additional capacity was not needed due to market conditions brought on by the COVID-19 pandemic. For more information, see Industrial Info's project report.

Notable completions in the third quarter include the Lone Star Express NGL pipeline expansion in Texas. Long said, "We were pleased to announce that our 24-inch, 352-mile Lone Star Express expansion was completed under budget and ahead of schedule. This project adds over 400,000 BBL/d of NGL pipeline capacity from the Permian Basin to the Lone Star Express 30-inch pipeline south of Fort Worth Texas." Construction on the pipeline began in late 2019. For more information, see Industrial Info's project report.

The company also is constructing and expanding a couple of terminal facilities in Nederland, Texas, on the Gulf Coast, including a liquefied petroleum gas (LPG) terminal and ethane terminal. "LPG demand continues to remain strong, and our LPG expansion projects at Nederland will bring our total export capacity to approximately 500,000 BBL/d, further integrating our Mont Belvieu assets with our Nederland assets," Long said. The project entails adding two LPG trains to add 235,000 BBL/d of fully refrigerated LPG loading. Construction began last summer and is expected to be completed by the end of this year. For more information, see Industrial Info's project report.

"Construction of our Orbit ethane export joint venture with Satellite Petrochemical (Jiaxing, China) is nearing completion," Long said. "This 180,000-BBL/d project will be ready for commercial service in the fourth quarter of this year, with the first ships now arriving by the end of the year for commissioning." Construction on the terminal began last summer, with S&B Engineers & Constructors providing EPC services. For more information, see Industrial Info's project report. The project also includes a 62-mile ethane pipeline from Mont Belvieu to the terminal. For more information, see Industrial Info's project report.

Long said 2020 growth capital expenditures were expected to come in at less than $3.3 billion, more than $100 million less than previous guidance, as a result of projects coming in under budget. This will trail off in the coming years, as the company is forecasting growth capital spending of $1.3 billion in 2021, and $500 million to $700 million per year in 2022 and 2023.

Energy Transfer reported a third-quarter 2020 net loss of $782 million, compared with net income of $857 million in the prior year. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were $2.87 billion in the just-passed quarter, compared with $2.81 billion in 2019.

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.