UPDATE 1-NuStar to further expand Eagle Ford crude oil system

Thu Dec 13, 2012 12:40pm EST

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Dec 13 (Reuters) - NuStar Energy L.P will expand its crude oil pipeline system in the Eagle Ford shale in South Texas and build a new ship dock in Corpus Christi to better handle production growth in the prolific play, the company said on Thursday.

The plan includes a long-term pipeline and terminal services agreement with ConocoPhillips, one of the Eagle Ford's major producers.

The pipeline system expansion will include a new 100,000 barrels-per-day (bpd) pipeline originating near Pawnee, Texas, that will connect to NuStar's existing 12-inch system between Pettus and Three Rivers.

NuStar also will connect its existing 12-inch pipeline to the company's Oakville, Texas, terminal to deliver crude to its North Beach terminal.

The company also aims to build the new ship dock to support the North Beach terminal under a long-term lease with the Port of Corpus Christi. That private dock and refinery connections will allow for more pipeline system expansions as Eagle Ford output grows, the company said.

The pipeline expansion and dock projects will cost $100 million to $120 million. The pipeline project is slated to be finished in the fourth quarter next year, while the dock project is expected to be done by the first quarter of 2014, the company said.

In July, NuStar completed a third pipeline to carry Eagle Ford crude to the Port of Corpus Christi, which gave the company ability to move 250,000 bpd to U.S. Gulf Coast refineries.

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