Crude Pipeline Reversal Project Is Open for Shippers

The Houston to Nederland, Texas, segment of Shell Pipeline's Houston to Houma, Louisiana, crude pipeline reversal project is open for shippers, a company spokeswoman said Wednesday. 

"The reversal is progressing on schedule, and the capacity of the segment is [200,000 b/d] assuming a Mars-type crude," spokeswoman Kayla Macke said in an email. 

Mars is the US Gulf Coast's sour crude benchmark. 

Macke did not say when the first phase of the project opened. 

The segment was closed for reversal work in early November. At that time, Shell said that the reversed flow on the pipeline should begin in late December 2012 or early January. 

The Ho-Ho line reversal project's first phase involves the shipping of crude from Houston to refineries in the Port Arthur area. The line ships crudes from the Eagle Ford shale and Permian Basin in Texas and also oil coming in from Cushing, Oklahoma, through the Seaway pipeline. 

Subsequent phases of the project include reversing the pipeline between Nederland/Port Neches and delivery points in Louisiana to service facilities in the Lake Charles, Clovelly and St. James areas. 

The "Ho-Ho pipeline" traditionally shipped petroleum from Houma to Houston. The reversed pipeline would enable about 300,000 b/d of crude to be shipped, according to the company. 

In late December 2012, Shell said it would issue a second open season in January inviting additional firm capacity commitments for the fully reversed pipeline system. 

In the second open season, Shell said it would offer contract tariff rates from Houston to St. James/Clovelly, Louisiana, and from Nederland/Port Neches near Port Arthur, Texas, to St. James/Clovelly. 

In a statement on its website, Shell said it would offer rates ranging from $1.74/b to $2.75/b for shipments from Houston to Clovelly and St. James and from $1.74/b to $2.15/b for shipments from Nederland to Clovelly/St.James.