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Dallas-based Crosstex says it now has enough long-term supply commitments to begin construction of a 130-mile extension to its Cajun-Sibon natural gas liquids (NGL) pipeline system.
Not only that, but “supplier interest” has already led Crosstex to expand the $230 million project beyond the scope announced in July, with an additional supply connection, the company said.
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Crosstex Energy LP |
| The scope of the pipeline project has already been expanded since it was announced in July. |
The 130-mile, 12-inch-diameter pipeline will extend the company’s current 440-mile Cajun-Sibon NGL system and connect its NGL fractionation facilities in south central Louisiana to Mont Belvieu supply pipelines in East Texas.
Construction is expected to begin in the third quarter of 2012, with operations beginning in the first half of 2013. The new pipeline should begin operations at or near its initial capacity of 70,000 barrels of NGL per day, Crosstex said.
‘Strong Interest’
Crosstex has signed a long-term ethane sales agreement with Williams Olefins, LLC, a subsidiary of the Williams Companies, for the key product in the project.
“We are pleased with the strong interest in this project,” said Barry E. Davis, Crosstex President and CEO. “The willingness of midstream and producer customers to make long-term commitments reflects increasing demand for fractionation and NGL handling as producers continue to pursue liquids-rich natural gas plays.”
Crosstex estimates that the project will create 1,351 net new jobs during construction.
Crosstex Energy, L.P., a midstream natural gas company, operates about 3,300 miles of pipeline, nine processing plants and three fractionators.
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