Magellan plans $250m condensate splitter

March 31:


Project: Magellan to build condensate splitter

Oklahoma-based Magellan Midstream Partners said on Monday that it plans to build a $250 million condensate splitter at its terminal in Corpus Christi, Texas, alongside international commodity trader Trafigura.

The facility will be built under a fee-based, take-or-pay agreement with Trafigura, Magellan said.

Included in the project design is more than 1 million barrels of storage, dock improvements and two additional truck rack bays at Magellan's terminal, as well as pipeline connectivity between the terminal and Trafigura's nearby facility.

The splitter will be capable of processing 50,000 barrels per day of condensate, "fully supported by a long-term commitment from Trafigura". Magellan could build a second 50,000-bpd splitter at the same site "if warranted by additional demand".

Magellan chief executive Michael Mears said the splitter is a response to increased domestic condensate production in the US.

"Our Corpus Christi terminal is ideally situated to receive condensate from the Eagle Ford shale, including shipments via our Double Eagle pipeline joint venture, and to offer flexible services and a variety of market options for our customer," Mears said in a statement.

Condensate comprises about half of the Eagle Ford's increasing output. The US Energy Information Administration expects Eagle Ford output to reach 1.36 million bpd in April.

Magellan expects the splitter to be operational during the second half of 2016, pending permit approvals.

Magellan said last year that it was looking for a partner to build a condensate splitter at its Corpus Christi marine terminal.

Separately, Targa Resources Partners announced plans to build a $115 million, 35,000-bpd condensate splitter at its Channelview Terminal on the Houston Ship Channel.

Targa said it was working with Noble Group to support the project with a long-term, fee-based contract, and that the project was expected to start up about 18 months after permits were secured.

Source: http://www.upstreamonline.com/live/article1356976.ece?