EPP, American Midstream evaluate gas processing combine

Enterprise Products Partners LP and American Midstream Partners LP have entered an agreement under which American Midstream may purchase a 25% interest in EPP’s 1-bcfd natural gas processing plant in Pascagoula, Miss.

The purchase option remains subject to certain conditions, including American Midstream completing modifications to certain installations on its High Point pipeline system that would provide incremental gas volumes with access to the Pascagoula plant, EPP said.

The High Point pipeline system currently delivers offshore gas production to the EPP-operated 300-MMcfd Toca gas processing plant in St. Bernard Parish, La.

Due to pending modifications to the High Point system’s installations, EPP, along with other owners of the Toca plant, voted to idle operations of the plant to use existing processing capacity at the more efficient Pascagoula plant, EPP said.

Customers of the Toca plant, however, will have the option to enter into similar processing arrangements with the Pascagoula plant, which should provide customers with higher netbacks in the form of improved NGL recoveries and reduced energy costs, EPP said.

Neither EPP nor American Midstream disclosed a timeframe for when the parties might move forward with the proposed arrangement.

Contact Robert Brelsford at [email protected].