Jan 21 (Reuters) - Magellan Midstream and Enterprise Products plan to jointly develop a futures contract for the physical delivery of crude oil in the Houston area, the companies said on Thursday.

The midstream infrastructure companies said the project is in response to market interest for a Houston-based index with greater scale and price transparency.

Quality specifications of the oil will be consistent with West Texas Intermediate (WTI) crude oil originating from the Permian Basin, with delivery capabilities at either Magellan's East Houston terminal or Enterprise's ECHO terminal.

The contract for West Texas intermediate crude, or WTI, is the benchmark for U.S. crude oil prices.

The joint announcement comes two years after both companies separately struck agreements with crude futures exchange operators.

In 2018, Intercontinental Exchange launched a WTI contract with price, settlement and delivery at Magellan's terminal in East Houston. Enterprise separately agreed to use its Houston hub for a WTI futures contract with CME Group Inc.

(Reporting by Arundhati Sarkar in Bengaluru; Editing by Devika Syamnath)