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Enterprise Products Plans Additional NGL Fractionation Train


Enterprise Products Partners L.P. EPD is planning to increase the natural gas fractioning capacity for a project close to its Mont Belvieu facilities. The partnership intends to develop two natural gas liquids (NGL) fractionation trains for the project instead of its initial plan of just one, per Houston Business Journal.

The initial project plan was expected to cost Enterprise Products $557.2 million, which is now estimated at $789.7 million. However, the increase in the partnership’s assets in the region will not be reflected in the number of permanent jobs expected to be created by the project, which will likely enroll 25 full-time employees.

In September, Enterprise Products announced the commencement of building of a new NGL fractionator in the Mont Belvieu region, marking its tenth NGL fractionator. It was backed by long-term customer accords and is expected to commence operations by the first quarter of 2020. The tenth fractionator is expected to have a capacity to process 150,000 barrels per day (B/D), leading Enterprise Products’ processing capability to 905,000 B/D in Mont Belvieu. The addition of another train to its original plan will enhance support for Enterprise Products’ fractioning operations in the region.

With the construction of the fractionation units, the partnership will be able to back the growing NGL volumes in the Unites States. Notably, Enterprise Products projects NGL output in the Permian Basin to more than double over the coming four years. The trains will enable the partnership to meet the mounting need for NGL products in both the domestic market and abroad.

Headquartered in Houston, TX, Enterprise Products is among the leading midstream energy players in North America. The partnership boasts an extensive network of pipeline that spreads across 50,000 miles. Importantly, the pipeline network is connected to every major shale play in America. Enterprise Products has rallied 6.8% over the past year against the 1.3% collective fall of the stocks belonging to the industry.

Zacks Rank and Other Stocks to Consider

Enterprise Products currently carries a Zacks Rank #2 (Buy). Other top-ranked players in the oil and gas sector include Petroleo Brasileiro S.A. PBR or Petrobras, Shell Midstream Partners, L.P. SHLX and Chevron Corporation CVX, each flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Petrobras is the largest integrated energy firm in Brazil and one of the major players in Latin America. It pulled off an average positive earnings surprise of 10.4% in the last four quarters.

Shell Midstream Partners is involved in owning, operating, developing and acquiring pipelines, and other midstream assets. The partnership delivered an average positive earnings surprise of 7.9% in the trailing four quarters.

Chevron is an integrated energy company based in San Ramon, CA. The company’s top line for 2018 is expected to grow 17.7% year over year.

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