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How Enterprise Products Partners’ Segments Performed in 2Q15

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Crude Oil Pipelines and Services segment

We discussed the NGL Pipelines and Services segment’s performance in the last part of this series. In comparison, Enterprise Products Partners’ (EPD) Crude Oil Pipelines and Services segment’s EBITDA (earnings before interest, tax, depreciation, and amortization) rose 28% in 2Q15—compared to 2Q14. The EBITDA growth was driven by more activity at the Houston Ship Channel terminal associated with the Oiltanking acquisition and higher revenue from the new Seaway Loop pipeline.

The segment’s ECHO (Enterprise Crude Houston) facility currently has a storage facility of 800,000 barrels. Enterprise Products plans to expand it to store 6 MMbbls (million barrels) of oil.

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Natural Gas Pipelines and Services

The above graph shows the segmental contribution to Enterprise Products Partners’ EBITDA in 2Q15 and 2Q14. Enterprise Products Partners’ Natural Gas Pipelines and Services segment’s EBITDA fell 6% in 2Q15—compared to 2Q14. The segment’s natural gas transportation volumes fell YoY (year-over-year).

The segment’s San Juan natural gas gathering system’s margins fell due to lower fees from natural gas price-indexed contracts. Its revenue margins from the sale of condensate and natural gas also fell in the quarter. The segment gathers, stores, processes, distributes, and markets natural gas.

Some other MLPs with natural gas gathering and processing assets include EQT Midstream Partners (EQM), Tallgrass Energy Partners (TEP), QEP Midstream Partners (QEPM), Summit Midstream Partners (SMLP), and Western Gas Partners (WES). EQT Midstream forms 3.10% of the Alerian MLP ETF (AMLP).

Petrochemical and Refined Products Services

Enterprise Products’ Petrochemical and Refined Products Services segment’s EBITDA rose 12% YoY. The rise was driven by the reactivation of a marine terminal. It was also driven by assets from the Oiltanking acquisition. The segment owns propylene fractionation, butane isomerization, octane enhancement, and high purity isobutylene facilities. It has refined products pipelines and terminals. It also offers marine transportation services.

Enterprise Products Partners’ Offshore Pipelines and Services segment’s EBITDA rose 32% YoY. Higher volumes in the segment’s SEKCO Oil Pipeline contributed to the rise.

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