Epic Midstream strikes deals in NGL sector, opens new plant

San Antonio-based Epic Midstream Holdings LP announced a number of deals for its natural gas liquids subsidiary Aug. 5, including the completion of a new, multimillion-dollar processing plant.

Epic Y-Grade LP’s 110,000-barrel-per-day fractionation plant in Robstown, Texas, is now in service and fully commissioned, the company said. Fractionation is the process of separating a mix of natural gas liquids into pure components — substances like ethane, propane and butane are often mixed with gasoline, used as petrochemical feedstock or used to heat homes.

Epic announced in December that it had taken out an extra $150 million on its credit line in order to finance the new facility, which will sit next to an already-operational fractionation plant processing 170,000 barrels of NGL per day.

The pair of facilities are fed by Epic’s Y-grade pipeline, which delivers NGLs from wells in the Permian Basin and Eagle Ford Shale to the processing plants. From there, the separated liquids are sent to refiners, petrochemical companies and export markets along the Gulf Coast, according to the company’s website.

Epic also announced Aug. 5 that it had sold an interest in an approximately 80-mile portion of the 700-mile Y-grade pipeline to fellow midstream companies Ohio-based MPLX LP (NYSE: MPLX) and Austin-based WhiteWater Midstream. MPLX and WhiteWater also entered into transportation agreements along other portions of the pipeline, which is capable of carrying up to 600,000 barrels per day of natural gas liquids.

In order to meet its obligations to the companies, Epic plans to extend an already existing ethane pipeline from Markham, Texas, to Sweeney, Texas, and convert the pipeline to one that carries NGLs.

Houston-based Phillips 66 (NYSE: PSX) also signed a multiyear contract with Epic for NGL and ethane storage, as well as ethane transportation and fractionation capacity.