Tuesday, December 21, 2010

U.S. Shale Still Bullish

Enterprise Products Partners L.P. (NYSE:EPD) announced today that the partnership has entered into 10-year agreements to handle a substantial portion of Chesapeake Energy Corporation’s (NYSE:CHK) liquids-rich natural gas production in the Eagle Ford Shale. Chesapeake’s gross acreage position currently comprises more than 625,000 acres in and around the oil and natural gas liquids (NGL)- rich areas of the Eagle Ford Shale across Dimmit, LaSalle, McMullen, Webb, and Zavala counties located in South Texas. The agreements provide Chesapeake with a comprehensive package of midstream natural gas and NGL services, including firm commitments for gas transportation, processing, and NGL transportation and fractionation services.

“We are extremely pleased with our new agreements with Chesapeake, which represent one of the largest single producer commitments to date for Enterprise in the Eagle Ford Shale,” said Michael A. Creel, Enterprise’s president and chief executive officer. “The deal with Chesapeake marks the fifth major midstream transaction Enterprise has executed with Eagle Ford Shale producers in the past year, reflecting the strategic importance of our integrated and expanding assets serving the various demands of producers in the prolific region.”
Enterprise has previously announced long-term commitments with Petrohawk, EOG, Anadarko and Pioneer.
Chesapeake’s NGL-rich natural gas will initially be gathered and compressed by Chesapeake affiliate, Chesapeake Midstream Development, LLC, for delivery to a central location. Enterprise will then transport and process the NGL-rich gas at its existing facilities while a previously announced natural gas processing plant that is currently under development in Texas is completed. This cryogenic processing facility, expected to be completed early in 2012, is designed for an initial capacity of 600 million cubic feet per day (MMcf/d) and with an initial capability to extract as many as 75,000 barrels per day (BPD) of NGLs.
The NGL production from Chesapeake’s gas will ultimately be transported on Enterprise’s previously announced 127-mile NGL pipeline that will extend from the new gas processing plant to Enterprise’s NGL fractionation complex in Mont Belvieu, Texas. This new NGL pipeline, also scheduled for completion in early 2012, is expected to have an initial capacity of more than 85,000 BPD and would be readily expandable to over 120,000 BPD.
Activity in the Eagle Ford Shale continues to increase as approximately 115 rigs working in the play have drilled more than 330 wells completed to date. Total current production from the play is estimated at approximately 425 MMcf/d of natural gas and 35,000 BPD of crude oil and condensate.
Enterprise Products Partners L.P. is the largest publicly traded energy partnership and a leading North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products and petrochemicals. The partnership’s assets include: 49,100 miles of onshore and offshore pipelines; approximately 195 million barrels of storage capacity for NGLs, refined products and crude oil; and 27 billion cubic feet of natural gas storage capacity. Services include: natural gas transportation, gathering, processing and storage; NGL fractionation, transportation, storage, and import and export terminaling; crude oil and refined products; offshore production platform services; petrochemical transportation and storage; and a marine transportation business that operates primarily on the United States inland and Intracoastal Waterway systems and in the Gulf of Mexico. Additional information is available atwww.epplp.com.
This press release includes “forward-looking statements” as defined by the Securities and Exchange Commission. All statements, other than statements of historical fact, included herein that address activities, events, developments or transactions that Enterprise expects, believes or anticipates will or may occur in the future, including anticipated benefits and other aspects of such activities, events, developments or transactions, are forward-looking statements. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including required approvals by regulatory agencies, the possibility that the anticipated benefits from such activities, events, developments or transactions cannot be fully realized, the possibility that costs or difficulties related thereto will be greater than expected, the impact of competition and other risk factors included in the reports filed with the Securities and Exchange Commission by Enterprise. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. Except as required by law, Enterprise does not intend to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.


Enterprise Products Partners L.P.
Investor Relations
Randy Burkhalter, (713) 381-6812 or (866) 230-0745
Media Relations
Rick Rainey, (713) 381-3635

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