Magellan Midstream Partners, LP and Enterprise Products Partners LP announced that subsidiaries of the two companies have entered into an agreement to jointly develop a futures contract for the physical delivery of crude oil to the Houston area in response to market interest in a Houston-based company. index with greater scale, flow assurance and price transparency.
Quality specifications will be consistent with WTI crude oil sourced from the Permian Basin with delivery capabilities to the Magellan East Houston terminal or Enterprise’s ECHO terminal in Houston.
“The quality and consistency recognized by the Midland WTI crude oil industry at Magellan’s East Houston terminal, combined with the flexible and reliable market access offered by Magellan and Enterprise, make this joint effort a logical step forward for contracts. futures on crude oil to provide added value to our customers, both domestic and international, ”said Michael Mears, CEO of Magellan.
“We are delighted to join Magellan on this initiative, which will provide customers with improved flexibility, connectivity, market access and price transparency for their physical barrels of crude oil,” said AJ “Jim” Teague, co-CEO of the General Partner of Enterprise. “This project will leverage the strengths of two large intermediate infrastructure systems, comprising five pipelines serving the Permian Basin, capable of delivering 2 million b / d of crude oil to the Houston market (with the potential for third-party pipelines from double the capacity of the Permian Basin crude oil on the market), a strong storage position on the Gulf Coast, redundant connectivity with all refineries in the Houston area and access to the largest network of export terminals in crude oil located along the Houston Ship Channel.
Read the article online at: https://www.hydrocarbonengineering.com/tanks-terminals/22012021/magellan-and-enterprise-developing-joint-houston-crude-oil-futures-contract/