Velocity Midstream begins building Eagle Ford oil line

Christopher E. Smith
OGJ Pipeline Editor

HOUSTON, May 19 -- Velocity Midstream Partners LLC has begun building the 12-in. OD Gardendale Pipeline, which will transport light crude and condensate through Webb, Dimmit, and La Salle counties, to Velocity's Gardendale Hub and Terminal near Gardendale, Tex. Velocity expects the pipeline and hub to be operational this fall.

Velocity has secured long-term commitments from Shell Western E&P for transportation and terminal services for its production from the Harrison Ranch (also known as the Piloncillo Ranch) in Webb and Dimmit counties.

The Gardendale line will gather and transport light oil and condensate from several producers and deliver it to Velocity's Gardendale Terminal. The Gardendale terminal and hub will have more than 100,000 bbl of initial storage and will provide access to downstream take-away pipelines, truck loading and unloading facilities, and US Development Group's rail loading facilities adjacent to Velocity's terminal.

Velocity is finalizing terms with area producers regarding gathering and transportation pipelines serving the Eagle Ford's lower API gravity oil window. Velocity plans to build its Eagle Eye oil pipeline both west and east of the Gardendale Hub to service these producers and to bring this line into operation soon after the Gardendale Hub starts up.

Velocity is also formalizing interconnection agreements with several downstream pipeline operators including Enterprise Products Partners LP and Plains All American Pipeline LP. Enterprise recently announced an extension of its Eagle Ford shale oil pipeline system to deliver crude from the Gardendale area to Houston (OGJ Online, May 6, 2011). Plains announced a commitment to construct an oil and condensate line from the western region of the Eagle Ford shale to a marine terminal facility in Corpus Christi, Tex. (OGJ Online, May 18, 2011).

The Gardendale Pipeline extends Velocity's Catarina Pipeline and Terminal in Catarina, Tex., in operation since February.

Contact Christopher E. Smith at chriss@ogjonline.com.

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