Houston-based midstream operator Easton Energy has signed an agreement with Exxon Mobil Corporation’s (NYSE:XOM) subsidiary, ExxonMobil Pipeline Company, to purchase the “South Texas Pipeline System.”
Easton Energy acquires ExxonMobil pipeline system
The pipeline runs around 720 miles from ExxonMobil’s Clear Lake and Katy Gas plant to Port of Corpus Christi and King Ranch Gas plant at the southern end of the pipeline. The pipeline system has always been used for transporting natural gas liquids and oil, but recently it shipped refinery grade propylene. The Pipeline System, which ExxonMobil has been operating for a while, is a best-in-class asset that has significantly benefitted from operational integrity programs, maintenance, and committed workforce of ExxonMobil. The companies expect to complete the deal in early next year.
Most importantly, the system will connect to Easton’s 50 million barrel salt dome storage in Markham in Texas. The system also connects Easton Energy’s distribution pipelines located in Mont Belvieu and Houston Ship Channel. The storage facility is situated between the Houston petrochemical markets and Corpus Christi. With the acquisition, Easton Energy’s interconnected pipeline will range from Houston to Corpus Christi, Texas City, month Belvieu, and Lake Charles, Louisiana. Easton Energy is targeting the provision of pipeline transport alternatives to the fast-growing petrochemical customer base.
Easton Energy enhancing its pipeline portfolio to serve customers
Joel McComas, Easton’s CEO and President, said that they are delighted to have an opportunity to work with ExxonMobil on the transaction. He said that he was delighted with the pipeline system’s addition to Easton Energy’s portfolio, which further allows Easton to Offer efficient and safe transport of liquid hydrocarbons.
Easton Energy has been enhancing its pipeline portfolio in recent times. Two years ago, the company acquired some pipeline systems from Williams Cos (NYSE:LWMB) in the US Gulf Coast for $177 million. The acquisition included the 31 mile Texas Belle Pipeline that transports natural gas liquids to customers along the Houston Ship channel and also other assets in the Live Oak Pipeline System and other idle pipelines along the Gulf Coast.