The US Gulf Coast is becoming the country’s preeminent petroleum storage hub as shale oil and natural gas liquids flow south to the massive refining and export center. In a move designed to capitalize on that trend, Enterprise Product Partners yesterday announced the $4.4 billion acquisition of storage company Oiltanking.

And according to The American Lawyer:

“Enterprise, which is also based in Houston and the largest U.S. pipeline operator by market value, said it will pay an additional $1.4 billion for the remaining 33 percent of Oiltanking’s general partner that it doesn’t already own in order to take full control of the company for a total deal value of $5.8 billion. 

Enterprise will hold 11 million barrels of oil storage capacity along the Houston Ship Channel as a result of the deal. Interestingly, Enterprise was already Oiltanking’s largest customer and now enterprise will gain visibility into the trading activity of Oiltanking’s other large clients that include oil majors ExxonMobil, BP and Shell. “It looks like they’re going to export condensate and crude – and they’ll know who else is too,” said one trader, according to Reuters.

“The Gulf Coast is going to be the place for having any storage. That’s where the money is,” Amrita Sen, chief oil analyst at Energy Aspects told Reuters

Enterprise was one of two companies granted approval to export minimally processed condensate earlier this year and now with its dominant storage position Enterprise is well placed to expand its export business.