Max Midstream said that it has acquired the Seahawk Pipeline and Terminal from Oaktree Capital at the Port of Calhoun in Texas and plans to build a pipeline with an investment of $1 billion that will directly connect the port to both the Eagle Ford and Permian Basins.

According to the Texas-based midstream company, the new pipeline will be able to transport up to 20 million barrels a month to a revitalized terminal at the Port of Calhoun.

Exports will start with completion of the first phase in the fag end of this year, and the second phase project is likely to be wrapped up by 2023, said Max Midstream.

Todd Edwards – President of Max Midstream said: “This is a great day not only for the Texas oil industry, but for the state as a whole, as more than 1000 jobs will be created.

“At a time when the oil and gas market is down, this project and partnership reflects proof that Texas is bouncing back and will remain resilient in being the world’s leader in oil production.”

Max Midstream said that it currently has agreements for three pipeline interconnects, one with Kinder Morgan Crude and Condensate, one to the Gray Oak, and the other to the Victoria Express.

The Seahawk pipeline connects the Kinder Morgan Crude and Condensate Interconnect in Edna, Texas to its Seahawk terminal at the Port of Calhoun.

Max Midstream said that future expansion with new pipeline connections with Gray Oak and Victoria Express to its Edna terminal will enable the transport of Permian and Eagle Ford basin crudes through the Port of Calhoun as well.

Todd Edwards said: “By November of 2020 we will have 1.5 million barrels of storage built at Edna and 600,000 barrels of storage at the Port and the existing Seahawk pipeline, with the ability to export up to 4.2 million barrels a month.

“By the time the project is fully complete in 2023, we will have 9 million barrels of storage at Edna and 6 million barrels at the Port, with multiple pipelines to export crude through the Port.”

Max Midstream has reached an agreement with the Calhoun Port Authority on a public/private partnership under which the former will invest $360 million to fund the deepening and widening of the Calhoun port by 2023.

In the interim, the midstream company said that it has secured its own lightering zone to carry out reverse lightering to export crude onto larger ships such as very large crude carriers (VLCCs).

Initially, Max Midstream will load Panamax ships and reverse lighter to larger ships in its lightering zone. After the widening and deepening project is wrapped up, Aframax and Suezmax ships can also load at the Port of Calhoun.

  Calhoun Port Authority, Eagle Ford basin, Max Midstream, Oaktree Capital, Permian Basin, Port of Calhoun, Seahawk Pipeline and Terminal, Texas, Todd Edwards, USA