Jan. 3 (Bloomberg) -- Enterprise Products Partners LP, the largest U.S. pipeline partnership by market value, will build a 1,230-mile (1,979-kilometer) line to ship ethane from Pennsylvania to U.S. Gulf Coast petrochemical plants.
The ATEX Express pipeline will have the capacity to transport as much as 190,000 barrels a day, Houston-based Enterprise said in a statement today. The company has commitments from shippers to pay 14.5 to 15.5 cents per gallon.
Chemical companies including Dow Chemical Co. and LyondellBassell Industries NV are using more ethane and other natural-gas liquids from shale formations as a way to replace crude oil-based feedstocks such as naphtha. Enterprise estimates Gulf Coast petrochemical demand for ethane is about 955,000 barrels a day, according to the statement. Ethane is a feedstock for producing ethylene, the main ingredient in plastics.
“Producers want a complete solution and they’re willing to pay more for access,” said Horowitz, who rates Enterprise’s units a “strong buy” and owns none.
