Cheseapeake to anchor Enterprise’s pipeline

Enterprise Products Partners L.P. (EPD) and Chesapeake Energy Corporation have entered into a long-term contract whereby Chesapeake will anchor Enterprise’s proposed long-haul ethane pipeline from the Marcellus and Utica shale regions in Pennsylvania, West Virginia and Ohio to the U.S. Gulf Coast. The approximately 1230mi pipeline will have an initial capacity of 125,000 barrels per day of ethane and could easily be expanded through a combination of additional pumping horsepower and pipeline looping. The committed shipper transportation rate will range between 14.5 cents per gallon and 15.5 cents per gallon. Through connections at the partnership’s natural gas liquids (NGL) storage complex in Mont Belvieu, Texas, ethane production from the Marcellus and Utica shales would ultimately have direct or indirect access to every ethylene plant in the U.S. The pipeline could begin commercial operations by the first quarter of 2014. This new pipeline would provide producers in the Marcellus Shale play, as well as the Utica Shale, with much-needed midstream infrastructure to facilitate production of NGL-rich natural gas. It will also provide shippers with access to the highest value markets on the U.S. Gulf Coast for their ethane.

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