HOUSTON, Jan. 30, 2006 (PRIMEZONE) -- Enbridge Energy Partners, L.P. (NYSE:EEP) ("the Partnership") today confirmed it has received customer commitments to support construction of a $530 million expansion and extension of its East Texas natural gas system. The project is required to handle the strong growth occurring in East Texas natural gas production, particularly from the Bossier Sands and other regional producing formations. Key components of the project, which will all be located in Texas, include:
-- A 36-inch intrastate pipeline with capacity of approximately 700
MMcfd will be completed in stages throughout 2007. The new line
from Bethel to Orange County will provide service to a number
of major industrial and power companies in Southeast Texas and
will cross a number of interstate pipelines.
-- A 250 MMcfd treating facility, to be built near Marquez, will be
connected to the 36-inch pipe via a new 24-inch pipeline that
will be completed in early 2007.
-- A number of upstream facilities, including gathering pipelines
to tie existing facilities into the new intrastate pipeline, also
will be completed in early 2007.
Dan C. Tutcher, president of the Partnership's management company and general partner, commented, "This strategic project results from extensive coordination with our customers to develop and enhance access for growing Texas production to major markets in Southeast Texas. The extension and expansion of our East Texas System is a significant step towards avoiding shut in of gas production that would result from insufficient capacity. Increasing market options for customers is our ongoing priority; therefore, this project is designed to be expandable and is positioned for potential upstream and downstream extension."
Since early 2002, throughput on the Partnership's East Texas System has grown from approximately 550 to 900 MMcfd. A significant amount of the throughput increase is attributable to the Bossier Sands, which is a tight sands formation that became economic to produce in recent years with advances in extractive technology and stronger gas prices. Other regional plays, including the Deep Bossier zone, are also expected to yield continued production growth. The Partnership's reserve studies indicate that production in areas served by its existing and new facilities will continue to increase into the next decade.
In support of growing natural gas production in East Texas, the Partnership completed a 500 MMcfd transmission pipeline in mid-2005 to provide increased access from Bethel to the Carthage hub. This service is expected to be at capacity by mid-2006, thereby driving the need to develop additional access to natural gas markets, such as afforded by this new extension and expansion of the East Texas System.
When fully operational in late 2007, the new assets will be an additional source of stable cash flow for the Partnership. Volume and reserve commitments from shippers are expected to have an average term of at least five years and an estimated two-thirds of revenue will derive from fee-based services. The other one-third of revenue will result from sale of natural gas retained in lieu of fees. The commodity price volatility inherent in such contractual arrangements will be controlled within the parameters of the Partnership's existing Cash Flow at Risk policy.
For further information on this project, visit the website at: www.easttexaspipeline.com.
LEGAL NOTICE
When used in this news release, words such as "anticipates," "expects," "plans," "will" and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks, uncertainties and assumptions pertaining to factors such as: (1) changes in the demand for, or the supply of, and price trends related to natural gas and natural gas liquids; (2) changes in or challenges to Enbridge Partners' tariff rates; (3) the effects of competition, including by other pipeline systems; (4) regulatory approvals; and (5) performance of other parties. Reference should also be made to Enbridge Partners' filings with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the most recently completed fiscal year, for additional factors that may affect results. These filings are available to the public over the Internet at the SEC's web site (www.sec.gov) and via Enbridge Partners' web site.
PARTNERSHIP INFORMATION
Enbridge Energy Partners, L.P. (www.enbridgepartners.com) owns and operates a diversified portfolio of crude oil and natural gas transportation systems in the United States. Its principal crude oil system delivers crude oil received primarily from western Canada to refining centers in the U.S. Midwest, accounting for approximately 10 percent of total U.S. crude oil imports, and to Ontario, Canada. The Partnership's natural gas gathering, treating, processing and transmission assets are principally onshore systems located in the active U.S. Mid-Continent and Gulf Coast regions.
Enbridge Energy Management, L.L.C. (NYSE:EEQ) (www.enbridgemanagement.com) manages the business and affairs of the Partnership and its principal asset is an approximate 18 percent interest in the Partnership. Enbridge Energy Company, Inc., an indirect wholly owned subsidiary of Enbridge Inc. of Calgary, Alberta, (NYSE:ENB) (TSX:ENB) (www.enbridge.com) is the general partner and holds an approximate 11 percent effective interest in the Partnership.