DCP Midstream to build Sand Hills NGL Pipeline from Permian Basin, Eagle Ford Shale to Texas Gulf Coast

Source: DCP Midstream

DCP Midstream (NYSE:DPM) has approved the construction of the Sand Hills Pipeline to provide critical new capacity for natural gas liquids transportation from the Permian Basin and Eagle Ford Shale to market centers along the Gulf Coast. Planning and field work for Sand Hills has been under way for several months and now construction activities will accelerate. 

The Sand Hills Pipeline will consist of approximately 720 miles of 20-inch pipeline with an initial capacity of 200,000 barrels per day, which can grow to 350,000 bbl/d with the addition of very economic pumping stations. Sand Hills will be phased into service, with the first phase completed by the third quarter of 2012 to accommodate DCP’s growing Eagle Ford liquids volumes. Service to the Permian Basin will be available as soon as the second quarter of 2013. 

DCP Midstream will operate Sand Hills as a common carrier pipeline and will provide interconnects with strategically located NGL infrastructure in both the Permian and the Eagle Ford. In the Gulf Coast, Sand Hills has been routed to provide interconnectivity with multiple planned and existing fractionation and storage facilities in and around Mont Belvieu, Texas, providing shippers with optionality, choice and reliability of service. In parallel with Sand Hills, DCP continues to move forward with processing capacity additions in both the Permian and Eagle Ford. 

“DCP is excited to be moving forward with the Sand Hills Pipeline, providing a very efficient NGL transportation solution for DCP customers and third-party producers in both the Permian and Eagle Ford,” said Bill Waldheim, DCP’s northern business unit president. 

“DCP will support Sand Hills with a significant commitment for capacity to ship DCP’s growing Permian and Eagle Ford NGL production,” Waldheim said. “As the largest NGL producer in the Permian and with a growing processing position in the Eagle Ford, DCP has a strategic imperative to provide an industry solution to the growing capacity bottlenecks and is pleased to join with other processors in supporting and making Sand Hills a reality.”

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