Enterprise, Western Gas Form JV - Analyst Blog


Midstream energy service provider, Enterprise Products Partners, L.P. ( EPD ), and Western Gas Partners, LP ( WES ) have teamed up to hold natural gas liquid (NGL) fractionation trains 7 and 8.

Currently, both trains are under construction at Enterprise's complex in Mont Belvieu, Texas and are expected to commence commercial operations in the fourth quarter of 2013. Trains 7 and 8 are designed to fractionate around 170,000 barrels per day (bpd) of NGLs.

Enterprise holds the majority ownership interest of 75% in the joint venture (JV), while Western Gas retains the remaining 25% stake. The latest JV is also the third midstream energy infrastructure project in which Enterprise has partnered with Anadarko Petroleum Corporation ( APC ) and its affiliates.

Western Gas - a master limited partnership owned by Anadarko - handles transportation, gathering and processing of natural gas, natural gas liquids, crude oil and refined products. Anadarko, being a strategic partner has made considerable volume commitment to Enterprise's facilities, including NGLs to its fractionation complex at Mont Belvieu.

Earlier this month, Enterprise stated that it is steadily progressing with the development of a project to transport diluent-quality natural gasoline from its Mont Belvieu, Texas liquids storage complex to several potential delivery points in and around Chicago. This project is likely to add new connections to the partnership's pre-existing Southern Lights and Cochin pipelines.

As Eagle Ford Shale is gaining traction, pipeline companies and midstream operators are increasingly looking to the South Texas play for opportunities to build new networks. Enterprise is poised to benefit from its existing assets and new developments, like the Texas Express Pipeline project, in providing packaged services to producers in emerging shale plays.

Enterprise carries a Zacks Rank #2 (Buy). However, Zacks Ranked #1 (Strong Buy) Hornbech Offshore Services, Inc. ( HOS ) is expected to perform impressively over the short term.

ANADARKO PETROL (APC): Free Stock Analysis Report

ENTERPRISE PROD (EPD): Free Stock Analysis Report

HORNBECK OFFSHR (HOS): Free Stock Analysis Report

WESTERN GAS PTR (WES): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: APC , EPD , HOS , NGL , WES



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