Crosstex Energy Acquires Eunice Natural Gas Liquids Processing Plant, Fractionation Facility for $42 Millionadmin
The Crosstex Energy companies, Crosstex Energy, L.P. and Crosstex Energy, Inc., announced that the Partnership has acquired the Eunice natural gas liquids (NGLs) processing plant and fractionation facility from Phillip Morris for approximately $42 million, which includes $18 million of assumed debt. Previously, Crosstex managed the plant and facility, which are located in south central Louisiana, under an operating lease with Phillip Morris. It is estimated the acquisition will improve the Partnership’s adjusted cash flow by approximately $12 million per year through the elimination of lease operating expense.
“As part of our strategic plan, we have focused on increasing margins, reducing costs and achieving operating efficiencies throughout our core midstream assets in the Barnett and Haynesville shales and our natural gas liquids operations,” said Barry E. Davis, Crosstex President and Chief Executive Officer. “The acquisition of the Eunice plant is consistent with our plan because it will allow us to further enhance efficiencies and increase the profitability associated with our natural gas liquids business.”
The Eunice plant processes natural gas, separating the NGLs found in the gas stream and producing pipeline-quality dry natural gas for numerous customers. The processing plant has an above-ground NGLs storage capacity of 190,000 barrels and is interconnected with Crosstex’s Cajun-Sibon pipeline and Riverside fractionation system, which separates ethane, propane, iso-butane, normal butane and natural gasoline. In addition, the Eunice site includes an idle fractionator facility. The Eunice and Riverside fractionation facilities are connected to Crosstex’s underground storage unit at Napoleonville and to pipeline distribution systems for the sale of NGLs products in the Napoleonville and Mississippi River markets. The Eunice site contains a truck and rail unloading terminal that gathers NGLs for fractionation from U.S. eastern and western markets. The idle Eunice fractionation facility can be restarted if necessary to alleviate fractionation constraints at Mont Belvieu, Texas, where an industry hub for NGLs fractionation and storage is located.
The Eunice plant currently processes approximately 380 million cubic feet of natural gas per day and is capable of processing up to 1.2 billion cubic feet of gas per day. The plant is connected to onshore natural gas supply in Louisiana. It also is connected to continental shelf and deepwater gas production from the Gulf of Mexico and is positioned for processing liquefied natural gas deliveries. The plant is connected downstream to ANR Pipeline and Florida Gas Transmission and Texas Gas Transmission pipelines.