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Enterprise Products to Build Ethylene Export Terminal

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Midstream energy service provider Enterprise Products Partners LP (EPD - Free Report) has signed a letter of intent with U.K.-based Navigator Holdings Ltd. (NVGS) for jointly creating an ethylene marine export terminal at the Houston Ship Channel.

Enterprise Products is expected to be in charge of construction along with commercial works of the new facility. The unit is anticipated to be developed at the Morgan’s Point complex of Enterprise Products. It is to be noted that at the Morgan’s Point, the midstream energy player has created the largest ethane marine export terminal in the world.  

While Enterprise Products will get involved with the development of the export terminal, Navigator will deliver ethylene to the customers with the help of its fleet of 14 ethylene vessels.

Investors should know that the proposed ethylene marine export terminal will likely get lined to the ethylene pipelines and salt dome storage units of Enterprise Products. The construction of storage units and pipeline systems is in the process. To date, the partnership has not provided any information connected to the cost of the project and the number of new employees to be hired.

Based in Houston, TX, Enterprise Products is a leading master limited partnership (MLP), engaged in providing a wide range of midstream energy services to producers and consumers of natural gas, natural gas liquids (NGL) and crude oil. The partnership’s extensive pipeline network earns stable fee-based revenues.

However, since 2012, long-term debt at Enterprise Products has been on the rise at an exponential rate. Also, one-year pricing chart clearly shows that Enterprise Products – belonging to the Zacks categorized Oil/Gas Production Pipeline Mlp industry – has declined 7.2%.

As a result of these mixed factors, Enterprise Products currently carries a Zacks Rank #3 (Hold). A few better-ranked players in the energy sector are Canadian Natural Resources Limited (CNQ - Free Report) , Delek US Holdings Inc. (DK - Free Report) and Pembina Pipeline Corporation (PBA - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.          

We expect year-over-year earnings growth of almost 725% at Canadian Natural in 2017.  

Delek managed to surpass the Zacks Consensus Estimate in each of the last four quarters, with an average positive earnings surprise of 60.68%.

Pembina Pipeline’s earnings will likely grow over 87% year over year in 2017.

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