Enterprise Products Partners and Energy Transfer Partners today announced the formation of a joint venture that will design and construct a pipeline from Cushing, Okla., to Houston, Texas. Plans call for an additional 500,000 bbl of new storage to be constructed at Enterprise’s new Houston crude terminal, and the line would ostensibly be capable of pumping 400,000 b/d from Cushing to this terminus.   
The 584-mile project would originate at Enterprise’s 3.1-million-bbl crude storage tank farm at Cushing. The two companies would contribute existing assets to the venture. One of the keys would be taking Energy Transfer’s 240-mile, 24-inch diameter natural gas pipeline and use that conduit’s right-of-way capability for the construction of 354 miles of new pipe. The line would ultimately connect with Enterprise’s ECHO crude oil storage and terminal facility in southeast Harris County, Texas. That facility offers access to major Gulf Coast refining centers, including plants in Texas City, Pasadena, Deer Park, Baytown and the Houston Ship Channel.  
The companies are targeting an operations date as early as the fourth quarter of 2012, subject to regulatory approvals. Enterprise president and CEO Michael Creel said that the company expects to have firm, long-term commitments in place for the capacity of the line within the next 60 days. The project comes as WTI and similar crudes trapped in the U.S. midcontinent have traded for as much as $22/bbl below offshore light sweet crudes. Today, for example, the price of June WTI is about $12/bbl beneath the value of Brent crude.