Enterprise Products Partners L.P. and Enbridge Inc. announced today that certain of their affiliates have executed a letter of intent (“LOI”) to jointly develop a deepwater crude oil terminal in the Gulf of Mexico capable of fully loading Very Large Crude Carriers (VLCCs). Enterprise and Enbridge agreed to focus commercial development efforts on Enterprise’s Sea Port Oil Terminal (“SPOT”) deepwater crude oil terminal. Under the terms of the LOI, Enterprise and Enbridge agreed to negotiate an equity participation right agreement whereby, subject to SPOT receiving a deepwater port license, an Enbridge affiliate could acquire an ownership interest in SPOT Terminal Services LLC, which owns SPOT.
The SPOT project consists of onshore and offshore facilities, including a fixed platform located approximately 30 nautical miles off the Brazoria County, Texas coast in approximately 115 feet of water. SPOT is designed to load VLCCs at rates of approximately 85,000 barrels per hour, or up to approximately 2 million barrels per day. The SPOT design also meets or exceeds federal requirements and, unlike existing and other proposed offshore terminals, is designed with a vapor control system to minimize emissions. Construction of SPOT is subject to obtaining the required approvals and licenses from the federal Maritime Administration, which is currently reviewing the SPOT application.
“We are very pleased to work with Enbridge to jointly develop a deepwater port in the Gulf of Mexico to support growing exports of U.S. crude oil,” said A. J. “Jim” Teague, chief executive officer of Enterprise’s general partner. “We value Enbridge’s expertise and resources as we focus our collective commercial development efforts on making the SPOT project a reality.”
