(June 24, 2014 – Reuters) UPDATE 4—With Bakken oil pipeline, Enterprise goes where others have failed (By Ernest Scheyder and Sabina Zawadzki)
BISMARCK, North Dakota/NEW YORK, June 24 (Reuters) - Enterprise Products Partners LP proposed on Tuesday to build the first direct pipeline moving shale oil from the Bakken formation to the Cushing, Oklahoma storage hub, hoping to succeed where others have failed.
Read the full story here: http://www.reuters.com/article/2014/06/24/enterprise-prodt-pipeline-idUS...
FEEDING SEAWAY?
At the moment the Bakken oil that is piped out, some 300,000 bpd, is taken east and eventually lands on Enbridge's pipeline system running from Illinois southwards to Cushing.
From Cushing, many of the barrels continue south to Gulf Coast refineries via the 400,000 bpd Seaway pipeline, operated jointly by Enterprise and Enbridge.
John Auers, industry specialist and Senior Vice President at Turner, Mason & Co, noted an influx of light sweet crude from shale plays such as the Permian and Eagle Ford in Texas into the Gulf Coast, where refineries are more suited to heavy oil.
"Moving Bakken into that surplus just doesn't make sense. The place you need Bakken is the West Coast and the East Coast to displace imports and that's why rail has taken off," he said, referring to the boom in transporting crude by rail.
Sandy Fielden, director of energy analytics at RBN Energy, noted the Seaway 'twin', a 450,000 bpd pipeline tracing the same course as the original Seaway, is due to come onstream soon.
"Maybe Enterprise is trying to steal those Bakken barrels before they go to Cushing (via Enbridge's system) so that they can bring them directly into Cushing and then route them onto Seaway," Fielden said.
"It may be an effort to make sure that there is enough crude for the Seaway because what happens this year is the Seaway twin comes online. That seems to be the only strategic game."
