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Enterprise Products' Oil Terminal Review Temporarily Paused

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Enterprise Products Partners L.P.’s (EPD - Free Report) Sea Port Oil Terminal has witnessed temporary suspension of its review process, per Bloomberg. The U.S. Coast Guard and Maritime Administration are carrying out the review process for the facility in Texas. The suspension notice came on Jun 4. Enterprise Products has Enbridge Inc. (ENB - Free Report) as the joint venture partner in the project.

The federal officials have suspended the review process as they require more information on the offshore crude-oil export terminal project. The drafting of an environmental impact statement is halted as the firms are now required to give answers to some specific questions. Enterprise Products is currently working on the same.

Since export volumes of crude oil from the United States are expected to grow rapidly in the long run, both Enterprise Products and Enbridge are well positioned to capitalize on it with the proposed deepwater export terminal. Although energy demand is low due to coronavirus-induced lockdowns, things are expected to improve once the restrictions are lifted globally.

The offshore terminal will be located in the U.S. Gulf of Mexico and have the capability to fully load Very Large Crude Carriers (VLCCs). The offshore export terminal — which will be connected to onshore tanks with a 30-mile pipeline — is expected to export 85,000 barrels of oil per hour, or 2 million barrels a day. The application of the terminal was filed by Enterprise Products in January 2019. Enbridge joined the project in December. The facility is expected to come online in second-half 2022.

Price Performance

The stock has risen 61.8% since the beginning of the second quarter compared with 65.6% jump of the industry it belongs to.

Zacks Rank & Other Stocks to Consider

Currently, the partnership has a Zacks Rank #2 (Buy). Other top-ranked players in the energy space include Chesapeake Energy Corporation (CHK - Free Report) and CNX Resources Corporation (CNX - Free Report) , each holding a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Chesapeake Energy delivered an average positive earnings surprise of 42.8% in the last four quarters.

CNX Resources beat earnings estimates thrice and met once in the last four quarters, with average positive surprise of 111.5%.

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