UPDATE 1-Sunoco to proceed with Texas propane, butane pipeline

Mon May 6, 2013 11:21am EDT

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New York May 6 (Reuters) - Sunoco Logistics Partners LP said on Monday it had received sufficient binding commitments to ship propane and butane on its proposed Mariner South pipeline in Texas to proceed with the project.

The pipeline, which will have an initial capacity of 200,000 barrels per day and is expected to start shipping in the first quarter of 2015, will run from a storage complex run by Lone Star in Mont Belvieu to Sunoco's terminal in Nederland.

"In addition to export grade propane and butane, the pipeline will be available for other natural gas liquids and petroleum products depending on shipper interest," Sunoco said in a statement, adding its capacity could be scaled up.

Lone Star NGL LCC is a joint venture between Energy Transfer Partners LP and Regency Energy Partners LP. It operates 47 million barrels of storage capacity at Mont Belvieu as well as natural gas liquids pipelines.

Production of propane, a by-product of oil refining and natural gas processing, has surged together with the U.S. shale oil and gas boom. Exports of the liquefied petroleum gas have quadrupled in the past five years, according to U.S. Energy Information Administration data.

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