Kinder Morgan Energy Partners, Copano Energy's 50-50 JV, Eagle Ford Gathering, team with Williams Partners to increase Eagle Ford Shale natural gas processing capacity at Markham plant in Matagorda County, Texas, will spend US$27M to build pipeline
June 15, 2011
– Execute Long-Term Agreement with Williams Partners
Eagle Ford Gathering LLC, a 50/50 joint venture between Kinder Morgan Energy Partners, L.P. (NYSE: KMP) and Copano Energy, L.L.C. (NASDAQ: CPNO), today announced a long-term agreement with Williams Partners L.P. (NYSE: WPZ) to process Eagle Ford Shale production at Williams Partners' Markham processing plant located in Matagorda County, Texas.
Eagle Ford Gathering will construct a 7-mile, 20-inch lateral to connect its previously announced crossover pipeline project to the Markham plant and install approximately 3,400 horsepower of compression at a cost of approximately $27 million. The agreement will initially provide Eagle Ford Gathering with 100 million cubic feet per day of processing capacity at the Markham plant, with an option to increase its capacity to up to 200 million cubic feet per day.
Duane Kokinda, president of Kinder Morgan's Intrastate Pipeline Group, said, "We are pleased to enter into this significant new agreement with Williams Partners to increase the joint venture's gas processing capabilities. The new agreement augments the previously announced agreement with Formosa Hydrocarbons Company, resulting in up to 375 million cubic feet per day of total processing capacity through the crossover project. We expect to break ground on the crossover pipeline in July and to place it in service in the fourth quarter of 2011. In addition, the joint venture has 375,000 MMbtu per day of processing capacity at Copano's Houston Central plant through Kinder Morgan's Laredo-to-Katy pipeline."
"The joint venture's 117-mile, 30- and 24-inch system through McMullen, La Salle, Dimmit and Webb Counties is nearing completion," said Jim Wade, President and Chief Operating Officer of Copano Energy's Texas segment. "We expect the system to be placed into service in September and begin processing joint venture gas at Copano's Houston Central complex. We are pleased with the new, long-term relationship with Williams Partners, which represents continued progress in executing our overall Eagle Ford Shale strategy. The joint venture's combined capacity commitments, along with Copano's recently announced expansion of the Houston Central complex, will provide South Texas producers access to processing and fractionation capacity of up to 1.4 billion cubic feet of gas per day and over 100,000 barrels per day of NGL fractionation and product market."
Through Eagle Ford Gathering, Kinder Morgan and Copano expect to invest approximately $300 million in midstream infrastructure to provide gathering, transportation, processing and fractionation services to Eagle Ford Shale producers.
Read more: http://www.sunherald.com/2011/06/15/3196555/kinder-morgan-copano-increase.html#ixzz1PNExD4Pa