By Ben Lefebvre
Enterprise Products Partners LP (EPD) has begun accepting deliveries of crude oil from the increasingly productive Eagle Ford shale region in south Texas for shipment to Gulf Coast refiners, the company said Thursday.
The light, sweet crude delivered from the Eagle Ford shale formation will help reduce the needs for imports of the same into the Gulf Coast refining belt and help strengthen profit margins for the industry. Bill Klesse, chief executive of independent refiner Valero Energy Corp. (VLO), said Wednesday that domestic oil production by 2013 could make imports of light, sweet crude into the U.S. Gulf Coast region unnecessary.
Enterprise's system, which extends 147 miles from Wilson County, Texas, to Sealy, Texas, will transport up to 350,000 barrels a day of light, sweet oil.
Bringing Eagle Ford crude east will drive down the price of regional benchmark Light Louisiana Sweet, said Dahlman Rose & Co. analyst Sam Margolin. LLS crude sold for about $98.50 a barrel Thursday.
"It's a very good deal for refiners," Mr. Margolin said. "It loosens everything up."
The Seaway pipeline, a joint venture between Enterprise and Enbridge Inc. (ENB) on Wednesday made its first delivery to Houston of light, sweet crude from the U.S. oil storage hub in Cushing, Okla.
Write to Ben Lefebvre at email@example.com
(END) Dow Jones Newswires
June 07, 2012 18:19 ET (22:19 GMT)
Copyright (c) 2012 Dow Jones & Company, Inc.