Kinder Morgan has reportedly pulled out of a proposed joint venture (JV) with Enbridge to build a US Gulf Coast deepwater crude export terminal off the coast of Freeport, Texas.
The $800m terminal project, known as Texas COLT, also involves German oil storage firm Oiltanking Partners.
Kinder Morgan spokesperson Lexey Long was quoted was Reuters as saying: “The project does not align with our strategic priorities.”
The company took the decision to quit the project following an internal review and given the time commitment to move the project through a regulatory phase. In January 2019, the partners submitted a permit application with the US Maritime Administration (MARAD) to construct and operate a deepwater crude oil export port.
As part of the project, the JV proposed to establish an offshore platform and two offshore loading single point mooring buoys. These facilities would enable export of US shale to overseas markets on board a very large crude carrier (VLCC) with a capacity of two million barrels.
Media sources quoted Kinder Morgan as saying: “Given the ongoing commitment required to move this project forward through the regulatory phase and, after an internal review within Kinder Morgan, it was determined that continuing with the project does not align with our strategic priorities.
“Texas COLT is a more strategic and desirable project for Enbridge. The project aligns with Enbridge’s existing footprint in the US Gulf Coast region and their stated interest in growing their position in the region.”
The reports stated that Kinder Morgan sold its stake in the JV to Enbridge for an undisclosed price. Citing regulatory filings by Enbridge, Reuters stated that the COLT project would have the ability to load 23 supertankers per month at a rate of 85,000 barrels per hour. The offshore platform would be supported by a 42-inch pipeline, which will be connected to an onshore tank farm with up to 15 million barrels of storage capacity.
Subject to regulatory approvals and other conditions, the project is expected to be placed into service by 2022.