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These excerpts taken from the BP 6-K filed Aug 29, 2008. and WARRENVILLE, Ill.
- August 29, 2008 - Enbridge Inc. (TSX:ENB) (NYSE:ENB) and BP
Pipelines (North America) Inc. announced today they have entered into an agreement
to develop a new delivery system to transport Canadian heavy crude oil from
Flanagan, Illinois, to Houston and Texas City, Texas, using a combination of
existing facilities and new pipeline construction where required.
The new delivery system is expected to be in service by late
2012 with an initial total system capacity of 250,000 barrels per day (bpd) into
the Gulf Coast. Enbridge and BP intend to use the BP #1 System and other existing
pipelines north of the Cushing, Oklahoma, crude oil hub with some new pipeline
construction south of Cushing, to connect to markets in Houston and possibly
Nederland, Texas. Initial receipts at Flanagan, where the system would interconnect
with Enbridge Energy Partners' Southern Access pipeline, would be approximately
140,000 bpd with deliveries to Gulf Coast markets.
The remaining
110,000 bpd would originate from interconnecting
pipelines at Cushing.
"This proposed project offers timely and economic access for
shippers to the U.S. Gulf Coast market," said Steve Wuori, Executive Vice
President, Liquids Pipelines, Enbridge, Inc. "The new system would be a
continuation of our phased approach to Gulf Coast market access, which has the
objectives of minimizing capital cost and financial commitments required of
shippers, maximizing use of existing pipelines and rights-of-way and ensuring
attractive producer netbacks."
The project would be timed to coincide with the projected
ramp-up of crude oil production in western Canada. It would be complementary to
Enbridge's other market initiatives including the Trailbreaker Project, which is
planned to offer Gulf Coast access by tanker from Portland, Maine, by mid-2010; the
Southern Access Extension, which is expected to facilitate both heavy and synthetic
crude access to Patoka, Illinois, by 2011; and the Texas Access Pipeline, which is
positioned to move greater crude oil volumes from Patoka to the Gulf
Coast
at the time required by the market.
"These options offer unparalleled flexibility to shippers, and
this project reflects our objective to provide our customers with the best
transportation solutions available," said Mr. Wuori.
Jim Lamanna, president, BP Pipelines (North America) Inc.,
said "This proposal is consistent with BP's goals of maximizing value from existing
assets and minimizing environmental impacts. Combined with the construction and
operating experience of these two companies, the proposed new delivery system will
offer shippers the economics, predictability and flexibility that are required in
this high-cost environment. Also, timely redeployment of existing facilities
significantly reduces the environmental impact associated with alternative proposed
cross-country pipelines."
A BP Pipelines affiliate is expected to be a significant
committed shipper on the proposed system. Enbridge and BP Pipelines would make
capacity available to other potential shippers on terms competitive with other Gulf
Coast delivery proposals through
commercial arrangements targeted to be concluded
this
F
all.
Terms will
be
subject to approval by applicable regulatory authorities. The
two companies plan to operate the pipeline system by way of a joint venture,
subject to completing final agreements and securing other required
approvals.
and WARRENVILLE, Ill. - August 29, 2008 - Enbridge Inc. (TSX:ENB) (NYSE:ENB) and BP Pipelines (North America) Inc. announced today they have entered into an agreement to develop a new delivery system to transport Canadian heavy crude oil from Flanagan, Illinois, to Houston and Texas City, Texas, using a combination of existing facilities and new pipeline construction where required. The new delivery system is expected to be in service by late 2012 with an initial total system capacity of 250,000 barrels per day (bpd) into the Gulf Coast. Enbridge and BP intend to use the BP #1 System and other existing pipelines north of the Cushing, Oklahoma, crude oil hub with some new pipeline construction south of Cushing, to connect to markets in Houston and possibly Nederland, Texas. Initial receipts at Flanagan, where the system would interconnect with Enbridge Energy Partners' Southern Access pipeline, would be approximately 140,000 bpd with deliveries to Gulf Coast markets. The remaining 110,000 bpd would originate from interconnecting pipelines at Cushing. "This proposed project offers timely and economic access for shippers to the U.S. Gulf Coast market," said Steve Wuori, Executive Vice President, Liquids Pipelines, Enbridge, Inc. "The new system would be a continuation of our phased approach to Gulf Coast market access, which has the objectives of minimizing capital cost and financial commitments required of shippers, maximizing use of existing pipelines and rights-of-way and ensuring attractive producer netbacks." The project would be timed to coincide with the projected ramp-up of crude oil production in western Canada. It would be complementary to Enbridge's other market initiatives including the Trailbreaker Project, which is planned to offer Gulf Coast access by tanker from Portland, Maine, by mid-2010; the Southern Access Extension, which is expected to facilitate both heavy and synthetic crude access to Patoka, Illinois, by 2011; and the Texas Access Pipeline, which is positioned to move greater crude oil volumes from Patoka to the Gulf Coast at the time required by the market. "These options offer unparalleled flexibility to shippers, and this project reflects our objective to provide our customers with the best transportation solutions available," said Mr. Wuori. Jim Lamanna, president, BP Pipelines (North America) Inc., said "This proposal is consistent with BP's goals of maximizing value from existing assets and minimizing environmental impacts. Combined with the construction and operating experience of these two companies, the proposed new delivery system will offer shippers the economics, predictability and flexibility that are required in this high-cost environment. Also, timely redeployment of existing facilities significantly reduces the environmental impact associated with alternative proposed cross-country pipelines." A BP Pipelines affiliate is expected to be a significant committed shipper on the proposed system. Enbridge and BP Pipelines would make capacity available to other potential shippers on terms competitive with other Gulf Coast delivery proposals through commercial arrangements targeted to be concluded this F all. Terms will be subject to approval by applicable regulatory authorities. The two companies plan to operate the pipeline system by way of a joint venture, subject to completing final agreements and securing other required approvals. | EXCERPTS ON THIS PAGE:
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