Enterprise Executes Long-Term Agreement With Marathon In Piceance Basin
Houston, TX - Enterprise Products Partners L.P. recently announced that an affiliate of the partnership has entered into a long-term contract with Marathon Oil Company to provide a range of midstream services, including natural gas gathering, compression, treating and processing, for Marathon's natural gas production in the Piceance Basin of northwest Colorado. Under the terms of the contract, Enterprise Gas Processing, LLC will construct approximately 50 miles of new gathering lines to connect Marathon's multi-well drilling sites, production from which is expected to peak at approximately 180 million cubic feet per day (MMcf/d), to the partnership's 48-mile, 36-inch Piceance Creek Gathering System (PCGS). From there, the natural gas will be delivered to Enterprise's Meeker processing complex, the first phase of which was placed into service during October of 2007.
Phase I of Enterprise's Meeker processing complex is designed to process up to 750 MMcf/d of natural gas and has the capability to extract as much as 35,000 barrels per day (BPD) of natural gas liquids (NGLs). Phase II of the Meeker complex, which will double capacity of the facility to 1.5 billion cubic feet per day (Bcf/d) of natural gas and 70,000 BPD of NGLs, is expected to begin operations in the summer of 2008.
"We are very pleased to enter into this agreement and look forward to providing the midstream support that will facilitate Marathon's production goals in the Piceance Basin," said Michael A. Creel, president and chief executive officer of Enterprise. "For Enterprise, this initiative is especially significant because it involves construction of the partnership's first wellhead gathering system in the Piceance Basin, which will leverage our integrated value chain of assets in the Rockies and generate incremental income for investors."
Creel added that this agreement with Marathon is part of Enterprise's ongoing program that has resulted in the execution of numerous long-term contracts with major producers in the region over the past year. In fact, Enterprise has entered into agreements with more than half of the 12 largest producers in the Piceance Basin, representing the potential for more than 2 Bcf/d of natural gas supply, and expects to sign additional agreements with others in the near future.
In addition to gathering pipelines, Enterprise will also construct a new compressor station to deliver natural gas into the PCGS. The station, located approximately 25 miles south of the Meeker complex in Rio Blanco County, Colorado, will provide 22,000 horsepower of compression, as well as condensate handling and natural gas dehydration facilities.
SOURCE: Enterprise Products Partners L.P.