8-KRegulation FDOther EventsExhibits & Filings

ENTERPRISE PRODUCTS PARTNERS L.P. 8-K Report, Regulation FD Disclosure (Aug 20, 2008)

Filed August 20, 2008For Securities:EPDEPDU

Summary

Enterprise Products Partners L.P. (EPD) announced the formation of a new joint venture, Texas Offshore Port System (TOPS), through its indirect wholly-owned subsidiary Enterprise Offshore Port System, LLC. This venture, established in partnership with TEPPCO O/S Port System, LLC and Oiltanking Freeport L.P., will design, construct, own, and operate a new offshore crude oil port and pipeline system. The project, with a total expected investment of $1.8 billion, aims to facilitate the delivery of waterborne crude oil to the upper Texas Gulf Coast refining centers. Each partner will hold a one-third interest in TOPS. The project is slated to commence service in the fourth quarter of 2010. Enterprise will serve as the operator and construction manager for TOPS. The partnership agreement outlines capital contribution obligations, management structure through a committee of representatives from each partner, and provisions for cash distributions from operations. This strategic investment signifies EPD's commitment to expanding its infrastructure and service capabilities for the crude oil market along the vital Texas Gulf Coast.

Key Highlights

  • 1EPD, TEPPCO, and Oiltanking to form a joint venture, Texas Offshore Port System (TOPS), each holding a one-third interest.
  • 2TOPS will develop a new Texas offshore crude oil port and pipeline system to serve refining centers on the upper Texas Gulf Coast.
  • 3Total project investment is estimated at $1.8 billion.
  • 4The system is expected to begin service in the fourth quarter of 2010.
  • 5EPD's subsidiary will act as the operator and construction manager for the TOPS project.
  • 6Partners are obligated to fund capital contributions, with guarantees and dilution provisions for non-compliance.
  • 7Distributions of available cash from operations will be made to partners proportionally, with provisions for special allocations for expansion funding.

Frequently Asked Questions

The primary purpose of TOPS is to design, construct, own, and operate a new offshore crude oil port and pipeline system. This system is intended to facilitate the delivery of waterborne crude oil to the refining centers located along the upper Texas Gulf Coast.

EPD, through its indirect wholly-owned subsidiary, will have a one-third ownership interest in TOPS. Importantly, a subsidiary of Enterprise will also serve as the operator and construction manager for the project, indicating a significant operational role.

The total expected investment for the TOPS project is $1.8 billion. The system is scheduled to begin service in the fourth quarter of 2010.

Each of the three partners (EPD, TEPPCO, and Oiltanking) is obligated to fund capital contributions for the project. Affiliates have guaranteed up to $700 million of these obligations. Failure to contribute can lead to dilution of a partner's interest. Available cash from operations is generally distributed monthly to partners in proportion to their ownership interests, with potential for special allocations for future expansions.