Kinder Morgan Inc. divested its stake in the planned Texas COLT offshore crude oil export terminal on the U.S. Gulf Coast, dropping out of the $800 million joint venture led by Enbridge Inc.
The Houston-headquartered pipeline operator decided during an internal review that the project "does not align with [its] strategic priorities," the company said in a statement, adding that it also considered the necessary commitment to move the project through a regulatory phase. The stake was sold to Enbridge, who is developing the project with the German logistics service provider Oiltanking GmbH. The companies did not disclose financial details of the deal.
The Texas COLT terminal would be built near Freeport, Texas, and would be capable of loading very large crude carriers, or VLCCs, that can carry 2 million barrels of crude. The terminal would be served by an underwater pipeline bringing supplies from the Permian Basin, Eagle Ford Shale and Bakken Shale; and an onshore tank farm with up to 15 million bbl of crude storage. The project filed for a permit with the U.S. Maritime Administration in January.
In its statement, Kinder Morgan said the project would be a better strategic fit for Enbridge, as it "aligns with Enbridge's existing footprint in the [U.S. Gulf Coast] region and their stated interest in growing their position in the region."
Enbridge also said it plans to proceed with the project without Kinder Morgan. "The COLT partnership, which combines Enbridge's leading North American asset portfolio with an international petroleum terminaling company in Oiltanking, continues to be central to the strength of the Texas COLT proposal," Enbridge said in a statement.