This proposed agreement with LOCAP will provide Zydeco’s shippers with much desired additional capacity directly into the St. James market at a cost of transportation identical to Zydeco’s existing Houma to St. James pipeline tariff. An additional 100kbd to 140kbd of capacity to St. James is expected to be made available to Zydeco’s shippers beginning in the 3rd Quarter of 2016.
“We’re very excited about this agreement with LOCAP and the incremental capacity to St. James that we will be able to provide to our shippers,” said Michele Joy, vice president of Zydeco. “We’ve been exploring debottleneck solutions from Houma to St. James for quite some time and are pleased to have secured an alternative path which will enable us to meet our customers’ needs.” Shawn Lyon, president of LOCAP, added, “Being able to provide this solution with existing assets, will provide immediate benefit to the marketplace, in addition to future growth opportunities.”
Zydeco’s 18” pipeline from Houma to St. James has been prorated since the reversal of the Ho Ho System in late 2013. A joint tariff with LOCAP will be filed by Zydeco for movements of Poseidon crude oil from Houma to St. James. Moving Poseidon via LOCAP will create additional capacity for Zydeco’s shippers on the Houma to St. James 18” pipeline segment.
About Zydeco Pipeline Company LLC: Zydeco Pipeline Company is jointly owned by Shell Pipeline Company LP (SPLC) and Shell Midstream Partners, L.P. (NYSE: SHLX). Zydeco’s Houston to Houma oil pipeline system runs from Houston, Texas to market hubs in St. James and Clovelly, Louisiana. It provides US Gulf Coast refineries and terminals with pipeline access to additional sources of growing light crude oil production arriving in the Houston market from the Eagle Ford shale, Permian Basin and Bakken shale and to offshore production landing in Houma, Louisiana.
About LOCAP LLC: LOCAP is a common carrier pipeline system. LOCAP transports crude oil from Clovelly, Louisiana through a 54 mile, 48-inch pipeline to the LOCAP St. James Terminal facility and other destinations in St. James, Louisiana. In St. James, LOCAP offers further distribution to a large number of refineries via connecting pipeline systems.