Developers of a planned crude oil pipeline to connect the Permian Basin of West Texas and southeast New Mexico have decided to cancel the project, blaming a struggling market during the COVID-19 pandemic.
Enterprise Products Partners announced on Sept. 9 that it was cancelling its Midland to Echo 4 crude oil pipeline project that would have had the ability to transport up to 450,000 barrels per day of oil reported the Carlsbad Current Argus.
The move was intended to lower Enterprise’s capital spending for 2020, 2021 and 2022, and would result in a reduction of $800 million in expenditures, read a news release from Enterprise.
The cancellation was also expected to result in a $45 million impairment charge for the third quarter of 2020, the release read.
Source: Carlsbad Current Argus