Enterprise Products Partners L.P. (EPD - Free Report) recently announced that the Morgan’s Point ethylene export terminal has exceeded design interim loading capacity. The facility in Texas is expected to export more than 175 million pounds of ethylene this month. Enterprise Products has U.K.-based Navigator Holdings Ltd. (NVGS - Free Report) as partner in the project.
The terminal is loading an ethylene cargo of 44 million pounds on the Navigator Eclipse. By the end of this year, the terminal will have a loading capacity of 2.2 billion pounds per annum. During this time period, Enterprise Products expects to build an above-ground storage tank for ethylene. The terminal is expected to be supported by the partnership’s four ethylene pipeline systems. It expects to add three more connections by the end of this year.
The terminal is supported by the shale revolution that produced abundant natural gas liquids. Ethylene production is expected to surpass the 100 billion pounds per year mark by 2025. As such, the terminal is expected to allow producers to send their products to both domestic and international markets, as the demand for petrochemical products is likely to rise. The partnership has created a fully open access global hub for polymer grade propylene, which will likely lead to price transparency and an efficient market structure.
At the beginning of this year, the partnership exported the first cargo of ethylene from the facility. Navigator Europa, carrying 25 million pounds of ethylene, departed the facility for Marubeni Corporation, which is a Japan-based trading company. Marubeni Corporation is a long-term client of the terminal.
The stock has risen 41% since the beginning of the second quarter compared with 54.1% jump of the industry it belongs to.
Zacks Rank & Stocks to Consider
Currently, the partnership has a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include Chaparral Energy, Inc. (CHAP - Free Report) and CNX Resources Corporation (CNX - Free Report) , each holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Chaparral Energy’s bottom line for 2020 is expected to rise 57.8% year over year.
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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