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Howard Energy Partners Planning $500M Texas-to-Mexico Pipeline and Liquid Terminals System

Howard Energy Partners, January 29, 2016

Howard Midstream Energy Partners, LLC (HEP) announced today that its subsidiary, Dos Águilas, LLC plans to permit, construct, and operate its proposed Dos Águilas project, an open access system of refined products terminals and pipelines spanning from Corpus Christi, Texas to northern Mexico. The Dos Águilas project will offer direct and seamless transportation services for gasoline, ultra-low sulfur diesel, and jet fuel from the Corpus Christi refinery complex to Laredo, Texas and on to northern Mexico markets through deliveries to Nuevo Laredo, Tamaulipas and Santa Catarina, Nuevo León, near Monterrey. Pending all government approvals, the project is expected to be in-service in the first quarter of 2018.

The Dos Águilas project will include four new refined liquids terminals with a total combined capacity of 1.15 million barrels and approximately 287 miles of 12-inch pipeline with 72,000 barrels per day of initial capacity and the capability to expand to up to 90,000 barrels per day. In the United States, the project consists of a new terminal located in Robstown, Texas, near Corpus Christi and a 141 mile pipeline between Robstown and a new terminal in Laredo, Texas.  The project also includes 10 miles of pipeline from Laredo to the Rio Grande River and border crossing facilities.  In Mexico, the project will consist of 12 miles of pipeline from the Rio Grande River to a new terminal in Nuevo Laredo and 124 miles of pipeline from Nuevo Laredo to a new terminal in Santa Catarina, near Monterrey. The Dos Águilas project is expected to cost approximately $500 million dollars.  The US and Mexican governmental processes have commenced.

Dos Águilas intends to launch simultaneous open seasons for the US and Mexican pipelines in the first quarter of this year to solicit indications of interest for transportation services. Transportation rates originating in Corpus Christi are expected to be approximately $2.00 USD to Laredo, $3.25 USD to the Nuevo Laredo terminal, and $5.75 USD to Monterrey, exclusive of terminal fees. All rates are approximate and dependent upon commitment and term.

The Dos Águilas project is another example of how the 2013 Energy Reform in Mexico is creating a competitive market environment and lowering prices for Mexican consumers. Additionally, by directly connecting refineries in Corpus Christi with multiple markets in northern Mexico, we are essentially opening the door to a whole new customer base for Texas refiners,” said Mike Howard, Howard Energy Partners Chief Executive Officer.

Howard Energy has always operated under the philosophy that what is good for Mexico is good for South Texas,” said Howard. “We continue to believe in this philosophy and the Dos Águilas project is our second major venture in Mexico, along with our cross-border Nueva Era natural gas pipeline which is expected to be in-service next year. These two projects are testaments to increasing customer demand, our deep-rooted belief in the growing Mexican energy market, and the great partnerships and relationships we have developed there.

In 2015, HEP announced plans to construct the Nueva Era Pipeline, a natural gas pipeline directly connecting the company’s Webb County Hub in South Texas to Escobedo and Monterrey in Nuevo León, Mexico. The approximately 200-mile Nueva Era Pipeline is expected to be in-service in June 2017. For more information on the Nueva Era Pipeline, please visit www.pipelinenuevaera.com

 


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