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Enterprise Products Partners’ 1Q net income up 15.5%; PDH online in 3Q

HOUSTON, May 2, 2017 (PCW) – Enterprise Products Partners on Tuesday reported first-quarter net income of $771 million, up 15.5% from the $670 million seen in the year-ago period. The increase was attributed to stronger transportation volumes and exports, as well as increasing commodity prices.

EPD said it expects its 1.65 billion lbs/yr propane dehydrogenation unit at Mont Belvieu to be “up and running” in the third quarter, CEO Jim Teague said. The company has previously said it expects commercial production from this unit in July.

EPD’s petrochemical and refined products services segment’s gross operating margin was up 18% quarter-on-quarter to $182 million. Total segment pipeline transportation volumes were 827,000 b/d for 1Q compared with 852,000 b/d in 1Q 2016. Refined products and petrochemical marine terminal volumes were 399,000 b/d in 1Q, compared with 347,000 b/d in 1Q 2016.

EPD’s propylene business reported a $17 million increase in gross operating margin to $69 million in 1Q due to higher propylene sales margins and volumes and higher propylene fractionation fees at the Mont Belvieu plants. Propylene fractionation volumes increased 16% to 80,000 b/d in 1Q from 69,000 b/d in 1Q 2016.

Gross operating margin for Enterprise’s butane isomerization and related operations decreased $5 million due to lower butane isomerization volumes, which were 92,000 b/d in 1Q compared with 110,000 b/d in 1Q 2016. One of the EPD’s three butane isomerization towers had 26 days of unplanned downtime during the quarter, which resulted in lower volumes.

Operating Margin Record

The company’s NGL pipelines and services group saw its gross operating margin increase 9% to a record $856 million in 1Q compared with $784 million in 1Q 2016.

Enterprise’s NGL marketing activities contributed $23 million to the increase in gross operating margin, primarily due to higher sales volumes. Gross operating margin from the partnership’s NGL pipelines and storage business increased $28 million, or 7%, to $455 million in the quarter. NGL pipeline transportation volumes were a record 3.2 million b/d in the quarter compared with 3 million b/d in 1Q 2016. The partnership’s total NGL marine terminal volumes were a record 569,000 b/d in 1Q compared with 456,000 b/d in the year-ago period.

Volumes at EPD’s LPG export terminal increased 53,000 b/d and loaded 58,000 b/d of ethane in the quarter. Enterprise’s ATEX and Aegis ethane pipelines reported a $9 million increase in gross operating margin for the first quarter compared with the first quarter of 2016, primarily due to a 31,000 b/d increase in transportation volumes. Committed volumes under long-term contracts on ATEX increased to 116,000 b/d for 2017 from 104,000 b/d in 2016. Committed volumes are 131,000 under these contracts for 2018. -- Samantha Hartke

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