The terminal, connected to a number of petroleum facilities on the Houston Ship Channel, is seen beginning service during the second quarter of 2012. It will be the destination of Enterprise’s Eagle Ford Crude pipeline, as well as the soon-to-be-reversed Seaway crude pipeline.

Once Seaway’s co-venturers Enterprise and Enbridge Inc. have completed the project to change flow direction, the line will move crude oil from Cushing, Okla., to the Houston refining market. Burgeoning Canadian crude oil production, recently linked to the hub in Cushing, can also be accommodated on the Seaway line.   

Initial crude volumes moving south on Seaway to Houston are expected to be 150,000 b/d by the second quarter of next year, and some 400,000 b/d by 2013.   Calling the Seaway reversal an “important logistical solution” for the Cushing marketplace, CME Group COO Bryan Durkin touted the Seaway reversal as giving new viability to the existing light, sweet crude contract.

“We believe this new project will make the NYMEX Light Sweet Crude Oil (WTI) benchmark more accessible to global markets,” Durkin said. “This is a significant milestone, and we look forward to working with our oil industry customers to explore the development of a new physically-delivered crude oil futures contract at Enterprise’s ECHO terminal.”   Under consideration for the new contract are similar quality specifications as the current NYMEX WTI contract. Other crude oil contracts could be added for physical delivery at ECHO at a later time, CME said.   

Refineries with access to the ECHO terminal include those in Texas City, Pasadena, Deer Park and Baytown, as well as those along the Houston Ship Channel, and represent more than 2 million b/d of processing capacity. Engineering work is now underway for an extension of Seaway from ECHO to Port Arthur, Texas, where refineries have heavy-crude refining capability.