Double E Pipeline Project

This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor and the Center for Media and Democracy.

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Double E Pipeline Project was a proposed oil pipeline in the United States that was ultimately canceled. Litigation subsequent to project's cancelation resulted in a landmark Texas court decision that determined business partnerships could be formed in the absence of an actual partnership agreement being formalized, akin to a common law marriage.

Location

The pipeline would have originated in Cushing, Oklahoma and terminated in Houston, Texas.

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Project Details

• Operator: Enterprise GP Holdings, ETP Legacy LP
• Proposed capacity: 450,000 barrels per day
• Length: 584 miles
• Status: Cancelled

Background

Enterprise Products Partners L.P. (a subsidiary of Enterprise GP Holdings) and Energy Transfer Partners, L.P. (a subsidiary of ETP Legacy), formed a 50-50 joint venture and launched a binding open commitment period for available capacity on the pipeline in May 2011. The 584-mile pipeline with a planned capacity of 450,000 barrels per day would have provided transport from the Cushing hub to refineries in the Gulf Coast when placed in-service, which was expected at the time to be the fourth quarter of 2012. The pipeline project would have included converting 230 miles of existing natural gas pipeline owned by Energy Transfer to crude oil service.

In August 2011, Enterprise announced it was withdrawing from the project.

Lawsuit

In 2011, Energy Transfer Partners L.P. filed a lawsuit against Enterprise Products Partners and Enbridge Inc. after the pipeline project was canceled. Energy Transfer Partners alleged that Enterprise claimed the project was not economically viable, broke the terms of the joint venture by releasing a press release without ETP's consent stating that the Double E pipeline was canceled, and then announced a deal with Enbridge to build the Wrangler Pipeline.

In March 2014, Energy Transfer Partners was awarded $319 million in damages by a Texas jury when it determined that it had been wrongfully dropped from the partnership. However, the jury did not find that Enterprise and Enbridge had conspired to remove Energy Transfer Partners from the partnership.

The jury's verdict was described as a "landmark decision for Texas business lawyers and their corporate clients by clarifying what constitutes a business partnership under state law." Significantly, the jury found that Energy Transfer Partners and Enterprise Products Partners had formed a partnership despite the fact that specific preconditions not being satisfied that would have created binding partnership obligations, a situation likened to a common law marriage.