South Sudan says North drops demand for $22.80 per barrel in transit fees

KHARTOUM - The Sudanese government has dropped its initial demand for a charge of $22.8 per barrel to transport oil from landlocked South Sudan through the pipelines leading to Port Sudan, an official in Juba said on July 30.

Pagan Amum, South Sudan’s Peace minister and chief negotiator, briefed journalists in the capital Juba on July 30, shortly after returning from Addis Ababa.

Amum made the revelation upon his return from the Ethiopian capital where the African Union (AU) is hosting talks between Khartoum and Juba on post-secession arrangements, particularly economic issues.

"This discussion brought to an end the attempt to impose discriminatory surcharges by the government in Khartoum, who announced they would impose $22.8 per barrel transit fee,” he said. “They have withdrawn officially this position.”

"We will be paying pipeline fees ... and also we will be paying transit fees that are within the international practices and standards," Amum added, without saying how much the South was willing to pay.

Oil from ExxonMobil's Silvertip spill found on 58 percent of Yellowstone River shoreline

NEW YORK - The failed Exxon Mobil Silvertip pipeline that spilled up to 50,000 gallons of oil into the Yellowstone River has coated 58 percent of the Yellowstone River's shoreline, according to Businessweek.com.

The tally released on July 26 by Montana Department of Environmental Quality director Richard Opper offers one the first clear gauges of the scope of the spill after weeks of high water slowed access to fouled areas.

Just over 40 percent of shoreline inspected to date had light to very light oil. Seventeen percent had moderate oil. Just one percent was heavily contaminated.

The state says the July 1 spill, which came amid flooding from mountain snowmelt, dumped up to 1,200 barrels of oil (50,400 gallons) into the Yellowstone near Laurel, Mont.

White House dismisses need for bill to accelerate decision on Keystone XL pipeline

A bill that would require the federal government to speed up its decision on TransCanada's Keystone XL pipeline is "unnecessary" and would only affect efforts to evaluate the project, according to the White House.

"(T)he bill conflicts with long-standing Executive branch procedures regarding the authority of the President and the Secretary of State, and could prevent the thorough consideration of complex issues which could have serious security, safety, environmental, and other ramifications," the White House said in a statement of administration policy.

Meanwhile, the U.S. Chamber of Commerce said it supports legislation passed by the House of Representatives that would require the federal government's decision on TransCanada's Keystone XL pipeline by Nov. 1. "Canada is a secure and reliable source of affordable energy, and the Keystone XL pipeline project provides the U.S. with a tremendous opportunity to take advantage of a stable source of needed energy from a strategic ally," said R. Bruce Josten, executive vice president for government affairs at the chamber.

The House bill is unlikely to survive a vote in the U.S. Senate.

Crosstex announces Louisiana gas liquids pipeline, fractionation project

DALLAS, Texas - The Crosstex Energy companies, Crosstex Energy, L.P. (the partnership) and Crosstex Energy, Inc. (the corporation), on July 25 announced that the partnership is completing engineering studies, pipeline routing work and environmental permitting for a natural gas liquids (NGL) project that will expand Crosstex's Louisiana fractionation facilities and expand access to these facilities and Louisiana product markets through a new NGL pipeline.

The new pipeline will be an extension of the partnership's 440-mile Cajun-Sibon NGL pipeline that is connected to the partnership's Eunice NGL fractionation facilities in south central Louisiana.

, Williams Olefins

The new 130-mile, 12-inch NGL pipeline extension will connect the Eunice fractionation facilities to Mont Belvieu supply pipelines and will have an initial capacity of 70,000 barrels per day (b/d) of raw-make NGLs.

The project also includes the expansion of the partnership's Eunice NGL fractionation facilities from 15,000 b/d to 55,000 b/d of NGL, which will increase the Partnership's interconnected fractionation capacity in Louisiana to approximately 97,000 b/d of NGLs.

The partnership's investment for the project is currently estimated at $180 million to $220 million.

The partnership has entered into a long-term ethane sales agreement with Williams Olefins, LLC, a subsidiary of the Williams Companies, providing a secure market for the key product in the project. The ethane will flow into Williams' ethane pipeline system in Louisiana. In addition, the Partnership has its own supply from its Texas gas plants and commitments for supply from a select group of NGL suppliers.

The partnership is negotiating additional long-term commitments for the new system expansion, which will provide producers and other midstream companies with an attractive alternative market for their NGL production at Mont Belvieu pricing.

"This is an exciting opportunity for Crosstex and gives us a tremendous growth platform as we expand our integrated NGL system and optimize our assets," said Barry E. Davis, Crosstex president and CEO.

The new NGL pipeline extension will originate from interconnections with major Mont Belvieu supply pipelines, providing connections for NGLs from the Permian Basin, Midcontinent, Barnett Shale, Eagle Ford Shale and Rocky Mountain areas to the Partnership's NGL fractionation facilities in South Louisiana. In addition to an attractive ethane market, the Partnership's facilities in South Louisiana provide access to markets for the remaining components of the NGL barrel.

Construction of the new NGL pipeline extension is expected to begin in the second quarter of 2012, and the facilities are expected to be operational in the first quarter of 2013.

Magellan Midstream Partners hikes distribution

Magellan Midstream Partners, L.P. (NYSE: MMP) has raised its second quarter 2011 cash distribution by 2.0 percent sequentially and 7.2 percent year over year to 78.50 cents per unit ($3.14 per unit annualized). The cash distribution is up 199 percent since Magellan's initial public offering at the beginning of 2001. Magellan's new distribution is payable on Aug. 12 to unitholders of record on Aug. 4, 2011. The proposed hike in distribution at Magellan is in sync with its goal of raising the annual distribution by seven percent in 2011. The partnership has 36 consecutive quarterly increases since inception. Magellan Midstream units have a Zacks #3 Rank, which translates into a short-term Hold rating. Zacks also has a long-term Neutral recommendation on the stock.