|Enterprise Announces Construction of New Propylene Splitter and Expansion of Propylene Gathering Pipelines|
HOUSTON--(BUSINESS WIRE)--March 23, 2006--Enterprise Products Partners L.P. (NYSE:EPD) announced today that its operating subsidiary is making additional investments to expand its integrated network of petrochemical assets in Mont Belvieu and southeast Texas. These investments include the construction of a new propylene fractionator at its Mont Belvieu complex that will increase Enterprise's propylene/propane fractionation capacity by one billion pounds per year, or approximately 15 thousand barrels per day ("MBPD"), and the expansion of two refinery grade propylene gathering pipelines that will add 50 MBPD of gathering capacity into Mont Belvieu. The total investment in the new propylene fractionator and pipeline expansions, which are expected to be operational by late 2007, is estimated at $205 million, with approximately $130 million of the total targeted for the new fractionator and associated storage and handling improvements. These investments are a part of our previously announced growth capital budget for 2006.
Enterprise currently operates three propylene fractionators at Mont Belvieu with a net capacity to produce 58 MBPD of polymer grade propylene. Polymer grade propylene is 99.5% pure propylene and is used in the production of plastic consumer products, pharmaceuticals, detergents and solvents. Demand for propylene has grown an average 5.7% per year since 1999 according to the industry trade association, Chemical Market Associates, Inc. ("CMAI"), and is projected to continue to grow at that rate through 2008 according to CMAI.
Enterprise recently completed the acquisition of a 66-mile, 8-inch pipeline that will transport propylene from the large crude oil refining facilities located along the upper Texas Gulf Coast in the Port Arthur/Groves area to Mont Belvieu. Enterprise has executed a 20-year transportation contract with Total Petrochemicals U.S.A., Inc. and will initially connect with their refinery and another refinery in this region. Enterprise also completed the extension of its refinery grade propylene gathering pipeline to interconnect with two crude oil refiners in the Texas City area.
"Enterprise's propylene fractionation and gathering activities have provided our partnership with a consistent stream of fee-based cash flow," said Robert G. Phillips, Enterprise's President and Chief Executive Officer. "The combination of our new propylene fractionator and the expansion of our propylene gathering capacity confirms our commitment to major refiners in southeast Texas to utilize our systems to meet their growing requirements for propylene in this vitally important region. The additional capacity will provide commercial and operating flexibility to both Enterprise and our customers at a time of significant growth in demand for propylene."
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 and crude oil through 32,776 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.
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;
-- a reduction in demand for its products by the petrochemical, refining or heating industries;
-- the effects of its debt level on its future financial and operating flexibility;
-- a decline in the volumes of NGLs delivered by its facilities;
-- the failure of its credit risk management efforts to adequately protect it against customer non-payment;
-- terrorist attacks aimed at its facilities; and
-- the failure to successfully integrate its operations with assets or companies, if any that it may acquire in the future.
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., Houston Randy Burkhalter, 713-880-6812 www.epplp.com
SOURCE: Enterprise Products Partners L.P.