|TEPPCO Partners Agrees to Sell Pioneer Natural Gas Processing Plant to Enterprise Products|
HOUSTON--(BUSINESS WIRE)--Jan. 26, 2006--TEPPCO Partners, L.P. (NYSE:TPP) and Enterprise Products Partners L.P. (NYSE:EPD) today announced the execution of a letter of intent by an affiliate of TEPPCO to sell its ownership interest in the Pioneer silica gel natural gas processing plant located in Opal, Wyo., to an affiliate of Enterprise. The terms of the letter of intent provides that Enterprise would purchase the existing Pioneer plant, together with all of Jonah Gas Gathering Company's rights to process natural gas originating from the Jonah and Pinedale fields.
Pursuant to the execution of definitive agreements and subject to obtaining proper regulatory approvals and other consents, Enterprise would purchase the Pioneer plant and immediately commence construction to expand the capacity of the facility from 275 million cubic feet per day (MMcfd) to 550 MMcfd. The expansion is expected to become operational in mid-2006. Enterprise would also build a 650 MMcfd cryogenic natural gas processing plant adjacent to the Pioneer silica gel plant. When operating at full capacity, the Pioneer cryogenic plant would have the flexibility to operate from a conditioning mode to full recovery with the ability to recover a minimum of 2,500 barrels per day (BPD) and a maximum of 30,000 BPD of mixed natural gas liquids (NGLs). This facility would be expected to begin service by the end of third quarter 2007. The Pioneer expansion and the new cryogenic plant would serve the growing natural gas production in the prolific Jonah and Pinedale fields.
"We are pleased to pursue this transaction with Enterprise Products Partners," said Lee W. Marshall, Sr., chairman and acting chief executive officer of the general partner of TEPPCO. "Natural gas processing is not a core business for TEPPCO and this facility is not integral to our midstream segment operations. More importantly, we believe that Enterprise's investment in, and development of the Pioneer cryogenic plant will be a long-term benefit for our Jonah Gas Gathering system. The sale of the Pioneer plant would also enable us to redeploy the proceeds in our growth projects, to retire debt or for other partnership purposes."
"Enterprise is looking forward to working with TEPPCO to reach a definitive agreement to purchase the Pioneer silica gel plant," said Robert G. Phillips, president and chief executive officer of Enterprise. "This is an attractive opportunity for us to extend our natural gas processing franchise into the prolific Jonah and Pinedale fields, one of the fastest growing natural gas producing regions in North America. NGLs extracted by the Pioneer cryogenic plant would support our 50,000 barrel per day expansion of the Rocky Mountain segment of our Mid-America Pipeline, which is expected to be completed by mid-2007, and our new 75,000 barrel per day NGL fractionator located near Hobbs, N.M., that should be in service in mid-2007."
TEPPCO Partners, L.P. is a publicly traded partnership with an enterprise value of over $4 billion, which conducts business through various subsidiary operating companies. TEPPCO owns and operates one of the largest common carrier pipelines of refined petroleum products and liquefied petroleum gases in the United States; owns and operates petrochemical and natural gas liquid pipelines; is engaged in crude oil transportation, storage, gathering and marketing; owns and operates natural gas gathering systems; and owns 50-percent interests in Seaway Crude Pipeline Company, Centennial Pipeline LLC and Mont Belvieu Storage Partners, L.P., and an undivided ownership interest in the Basin Pipeline. Texas Eastern Products Pipeline Company, LLC, a wholly owned subsidiary of DFI GP Holdings L.P. (a privately owned partnership indirectly controlled by Dan L. Duncan), is the general partner of TEPPCO Partners, L.P. For more information, visit TEPPCO's Web site at www.teppco.com.
Enterprise Products Partners L.P. is one of the largest publicly traded energy partnerships with an enterprise value of approximately $15 billion, and is a leading North American provider of midstream energy services to producers and consumers of natural gas, NGLs and crude oil. Enterprise transports natural gas, NGLs, crude oil and petrochemical products through 32,670 miles of onshore and offshore pipelines and is an industry leader in the development of midstream infrastructure in the deepwater trend of the Gulf of Mexico. Services include natural gas transportation, gathering, processing and storage; NGL fractionation (or separation), transportation, storage, and import and export terminaling; crude oil transportation and offshore production platform services. For more information, visit Enterprise on the web at www.epplp.com. Enterprise Products Partners L.P. is managed by its general partner, Enterprise Products GP LLC, which is wholly-owned by Enterprise GP Holdings L.P. (NYSE:EPE). For more information on Enterprise GP Holdings L.P., visit its website at www.enterprisegp.com.
Forward Looking Statements -- TEPPCO Partners L.P.
This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risks and uncertainties. These risks and uncertainties include, among other things, market conditions, governmental regulations and factors discussed in TEPPCO Partners, L.P. filings with the Securities and Exchange Commission.
Forward Looking Statements -- Enterprise Products Partners L.P.
This press release contains various forward-looking statements and information that are based on Enterprise's beliefs and those of its general partner, as well as assumptions made by and information currently available to Enterprise. When used in this press release, words such as "anticipate," "project," "expect," "plan," "goal," "forecast," "intend," "could," "believe," "may," and similar expressions and statements regarding the plans and objectives of Enterprise for future operations, are intended to identify forward-looking statements. Although Enterprise and its general partner believe that such expectations reflected in such forward-looking statements are reasonable, neither Enterprise nor its general partner can give assurances that such expectations will prove to be correct. Such statements are subject to a variety of risks, uncertainties and assumptions. If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, Enterprise's actual results may vary materially from those Enterprise anticipated, estimated, projected or expected. Among the key risk factors that may have a direct bearing on Enterprise's results of operations and financial condition are:
-- fluctuations in oil, natural gas and NGL prices and production due to weather and other natural and economic forces;
-- the effects of our debt level on its future financial and operating flexibility;
-- a reduction in demand for our products by the petrochemical, refining or heating industries;
-- a decline in the volumes of NGLs delivered by our facilities;
-- the failure of its credit risk management efforts to adequately protect us against customer non-payment;
-- terrorist attacks aimed at our facilities; and,
-- the failure to successfully integrate our operations with any companies that we may acquire in the future, if any.
Enterprise has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
CONTACT: Enterprise Products Partners L.P.
SOURCE: Enterprise Products Partners L.P.