Kinder Morgan Crude and Condensate LLC (KMCC) and Double Eagle Pipeline LLC, a 50/50 joint venture between Magellan Midstream Partners, L.P. and Kinder Morgan Energy Partners, L.P. (KMP), announced that they have entered into a long-term agreement with Anadarko Petroleum Corporation (APC) to transport Eagle Ford Shale production from Gardendale, TX, in LaSalle County, to the Houston Ship Channel via the KMCC Pipeline.
Double Eagle will construct 160,000 barrels of storage capacity and a pump station at Gardendale in addition to building an approximately 10-mile pipeline to connect the Double Eagle Pipeline and the KMCC Pipeline in Karnes County, TX.
Double Eagle will transport product from its new Gardendale station to the KMCC Helena station in Karnes County. KMCC will construct 240,000 barrels of storage at its Helena Station to move crude and condensate from the Double Eagle Pipeline to the KMCC delivery points. Double Eagle and KMCC expect to complete construction of these facilities in early 2015 to move production to the Houston Ship Channel.
“We believe connecting the Double Eagle and KMCC systems will offer unique flexibility for Anadarko and other Eagle Ford producers to access both the Corpus Christi and Houston-area markets,” said Don Lindley, president of Natural Gas Liquids for KMP, regarding the approximately $45 million Kinder Morgan investment. The transaction is expected to be immediately accretive to cash distributable to MMP and KMP unit holders upon the project’s completion.
The Double Eagle Pipeline includes 140 miles of new 12-inch pipeline connecting to an existing 50-mile, 14- and 16-inch pipeline segment owned by Kinder Morgan extending from Three Rivers, TX, to Magellan’s marine and storage terminal in Corpus Christi, TX. The initial capacity of the pipeline is 100,000 barrels per day, but can be expanded with additional pumps.