Enterprise Products Partners L.P. has executed definitive agreements to sell its offshore Gulf of Mexico pipelines and services business, which primarily consists of its Offshore Pipelines & Services business segment to Genesis Energy, L.P. for approximately $1.5 billion in cash. The transaction is expected to close during the third quarter of 2015. Enterprise's offshore assets include its ownership interest in nine crude oil pipeline systems with more than 1,100 miles of pipeline; nine natural gas pipeline systems totaling approximately 1,200 miles of pipeline; and its ownership interest in six offshore hub platforms.
'We are pleased to execute this agreement to sell our offshore Gulf of Mexico business to Genesis,' said Michael A. Creel, chief executive officer for Enterprise's general partner. 'In recent years, earnings from our offshore business represented only three percent of Enterprise's gross operating margin, and our offshore assets do not effectively integrate with our downstream crude oil and natural gas pipeline systems. We plan to redeploy proceeds from this sale into attractive growth opportunities that would extend and expand our integrated midstream system and should generate higher risk-adjusted returns on capital, such as acquisitions and organic projects in the Eagle Ford and Permian shale plays. In addition to enhancing our overall financial flexibility, the proceeds from this sale will effectively provide funds to finance the first installment of our recent acquisition of EFS Midstream LLC in the Eagle Ford and, furthermore, eliminates our need for equity capital for the remainder of 2015 based on our current expectations.'