Seaway pipeline capacity to Texas may be expanded more

Tue Feb 28, 2012 5:59pm EST

* Enterprise, Enbridge aim to ease Midwest oil glut

* 400,000 bpd from Cushing to Houston already subscribed

* New open season is to expand spur to Port Arthur

HOUSTON, Feb 28 (Reuters) - Partners reversing the Seaway pipeline to carry more oil from Oklahoma to Texas are now asking shippers whether they want the system expanded further, joint news releases said Tuesday.

The new open season applies to expanding an 85-mile (137-km) spur that will link the Houston terminus of the reversed Seaway to Port Arthur, Texas. It offers an additional 200,000 barrels per day of capacity to the Beaumont-Port Arthur refineries, in an effort to reduce the U.S. Midwest crude glut.

Partners Enterprise Products and Enbridge Inc in November announced plans to reverse Seaway, which currently runs 500 miles north from the Houston area to the Cushing, Oklahoma, storage hub.

Based on shipper response to previous open seasons, an initial 150,000 bpd is due to start flowing southward to Houston on Seaway by June 1, with capacity growing to 400,000 bpd by early 2013.

The original capacity of the Port Arthur spur was 400,000 bpd, with service set to begin in 2014, but if the new open season is successful, maximum capacity could rise to 600,000 bpd, Enterprise spokesman Rick Rainey said.

Expansion of the Port Arthur link appears to foreshadow expansion of Seaway beyond 400,000 bpd, but Rainey said no decision had been made.

Enterprise and Enbridge recently completed an open season asking whether shippers want to raise the capacity of the reversed Seaway to Houston beyond 400,000, and response was "very positive," though details are pending, Rainey said.

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