ONEOK, Inc. and MPLX LP have announced a joint venture to build a large-scale liquefied petroleum gas (LPG) export terminal and pipeline in Texas. This collaboration aims to expand energy infrastructure and enhance export capabilities. With a total investment of $1.4 billion, the project will significantly strengthen the midstream sector.
Key Details of the Joint Venture
LPG Export Terminal in Texas City
The new LPG terminal will be constructed in Texas City, Texas, with a massive capacity of 400,000 barrels per day (bpd). It will primarily handle low ethane propane (LEP) and normal butane (NC4), ensuring a steady supply to meet market demand.
The terminal will be directly connected to ONEOK’s Mont Belvieu storage facility via a new 24-inch pipeline, allowing seamless transportation of LPG. ONEOK and MPLX will each reserve 200,000 bpd for their customers.
Ownership and Investment
The joint venture, named Texas City Logistics LLC (TCX), will be equally owned by ONEOK and MPLX, with each company investing $700 million, bringing the total investment to $1.4 billion.
MPLX will take charge of constructing and operating the terminal. The project is expected to be completed by early 2028. By utilizing Marathon Petroleum Corporation (MPC)’s existing infrastructure, MPLX aims to reduce construction time and costs.
Pipeline Construction and Investment
In addition to the terminal, the companies will establish a pipeline joint venture, named MBTC Pipeline LLC. Ownership of the pipeline will be 80% ONEOK and 20% MPLX.
ONEOK will construct and operate the pipeline, with a total investment of $350 million. ONEOK’s share in the pipeline investment will be $280 million, while MPLX will contribute $70 million.
Strategic Significance
ONEOK President and CEO Pierce Norton II expressed enthusiasm about the partnership, emphasizing how these projects align with the company’s capital allocation strategy. He highlighted the growing demand for energy infrastructure and export capacity, positioning the venture as a key expansion for their Natural Gas Liquids (NGL) value chain.
ONEOK Completes Acquisition of EnLink Midstream
In a separate development, ONEOK completed the acquisition of EnLink Midstream, LLC for $4.3 billion in common stock. This acquisition was first announced in November 2024.
Key Highlights of the EnLink Deal
- ONEOK acquired all publicly held common units of EnLink.
- EnLink unitholders received 0.1412 shares of ONEOK common stock per unit.
- EnLink common units have been delisted from the New York Stock Exchange.
- ONEOK issued approximately 37 million new shares, increasing its outstanding shares by 6%.
ONEOK CEO Pierce Norton II welcomed EnLink employees and highlighted the benefits of the acquisition, reinforcing ONEOK’s integrated midstream business and commitment to providing long-term value to its stakeholders.
The joint venture between ONEOK and MPLX marks a significant step in expanding the LPG export market in Texas. With a $1.4 billion investment, the project will improve energy transportation and storage efficiency. Additionally, ONEOK’s acquisition of EnLink Midstream strengthens its presence in the midstream sector, reinforcing its position as a leader in energy infrastructure. These strategic moves highlight the increasing demand for energy exports and pipeline networks in the U.S. and demonstrate the companies’ commitment to long-term industry growth.
