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EPD’s Onshore Crude Oil Pipelines & Services Segment

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Asset overview of the segment

EPD’s Onshore Crude Oil Pipelines & Services segment includes approximately 5,400 miles of onshore crude oil pipelines, crude oil storage terminals in Oklahoma and Texas, and crude oil marketing activities. It also includes a fleet of approximately 560 tractor-trailer tank trucks, the majority of which are leased and are used to transport crude oil. This segment is further sub-divided into three subsegments, which include onshore crude oil pipelines, crude oil terminals, and crude oil marketing activities.

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Onshore crude oil pipelines subsegment

The onshore crude oil pipeline system gathers and transports crude oil from New Mexico, Oklahoma, and Texas to refineries, centralized storage terminals, and connecting pipelines. Some key pipeline systems include:

  • Seaway Pipeline System: This system connects the Cushing, Oklahoma, crude oil hub with markets in Southeast Texas. Seaway Pipeline comprises of the Longhaul system, the Freeport system, and the Texas city system.
  • Red River System: This system transports crude oil from North Texas and southern Oklahoma for delivery to local refineries and pipelines. This system is also connected to 1.2 million barrels of crude oil storage capacity that is owned and operated by EPD.
  • West Texas System: This system connects the crude oil gathering system in West Texas and southeast New Mexico to the terminal facility in Midland, Texas.

Crude oil terminals subsegment

EPD owns and operates crude oil terminals located in Cushing, Oklahoma, and Houston and Midland, Texas. These terminals are used for self operations and for customers.

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Crude oil marketing activities subsegment

This subsegment generates revenues from the sale and delivery of crude oil purchased either directly from producers or from others on the open market.

Key ETFs and stocks

Some of the MLPs that compete with Enterprise Products Partners (EPD) in the crude oil pipeline segment are Williams Partners (WPZ), Western Gas Partners (WES), EQT Midstream Partners (EQM), and Enable Midstream Partners (ENBL). These MLPs have a combined weight of 26.19% in the Alerian MLP ETF (AMLP).

In the next part of the series, we’ll discuss the transportation volume and the operating margin of EPD’s Onshore Crude Oil Pipelines & Services segment.

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