Page 8 - NorthAmOil Week 21 2022

NorthAmOil PIPELINES & TRANSPORT NorthAmOil

EnLink proceeds with Matterhorn

Express gas pipeline

PERMIAN BASIN DALLAS-HEADQUARTERED EnLink Mid- efforts to expand existing pipelines from the
stream said on May 19 that, together with its Permian Basin to the Gulf Coast or build new
partners, it would move forward with building ones.
the Matterhorn Express gas pipeline from the MPLX revealed earlier this month that it
Permian Basin to the Houston area of Texas. would increase the mainline capacity on its
The company made the decision to go ahead Whistler pipeline from the Permian to South
with development of the pipeline after secur- Texas by 500mn cubic feet (14.2 mcm) per day
ing sufficient transportation agreements from to 2.5 bcf per day, with service on the expanded
shippers. pipeline set to begin in September 2023.
The Matterhorn Express pipeline is a joint Meanwhile, Kinder Morgan has been solicit-
venture between WhiteWater, EnLink, Devon ing shipper commitments for proposed expan-
Energy and MPLX. The project is anticipated to sions of its Permian Highway and Gulf Coast
be operational in the third quarter of 2024. Express pipelines.
The new pipeline will have a capacity of up to Expansion of the 2.1 bcf (59.5 mcm) per day
2.5bn cubic feet (70.8mn cubic metres) per day Permian Highway project would boost the pipe-
of gas, which will be shipped over a distance of line’s capacity by 650 mmcf (18.4 mcm) per day,
roughly 490 miles (789 km) from Waha to Katy, representing a more than 30% increase. Expan-
near Houston. Supply will be sourced from con- sion of the 2 bcf (56.6 mcm) per day Gulf Coast
nections in the Permian Basin. This includes Express pipeline would see its capacity raised
direct connections to processing facilities in the by about 570 mmcf (16.1 mcm) per day, also a
Midland sub-basin through a roughly 75-mile roughly 30% increase.
(121-km) lateral, as well as a direct connection Together, the expansion of these three pipe-
to the Agua Blanca pipeline, which is operated lines would boost capacity by over 1.7 bcf (48.1
by WhiteWater and MPLX. mcm) per day, which is expected to help Permian
Amid booming global demand for gas and gas production hit 20.0-20.5 bcf (566.4-580.6
LNG, pipeline operators are now stepping up mcm) per day by late 2025.™

INVESTMENT

Terra reportedly exploring $2.5bn sale

COLORADO PRIVATE equity firms Kayne Anderson Cap- Terra was established in 2015 with financial
ital Advisors and Warburg Pincus are report- backing of $300mn provided by Kayne Ander-
edly considering selling Terra Energy Partners. son. Warburg Pincus joined Kayne Anderson a
Sources familiar with the matter told Reuters year later as an equal partner after it helped fund
last week that the companies were seeking up the acquisition of Terra’s current acreage posi-
to $2.5bn including debt for the Houston-based tion from WPX Energy in a deal valued at about
producer. $910mn.
Earlier this month, the two companies This year has seen several gas producers
launched an auction process to unload their put up for sale by their private equity owners.
majority stake in Terra, according to Reuters’ In March, Reuters reported that Denver-based
sources, who cautioned that the price or timing Caerus Oil and Gas was exploring a sale that
of any potential deal remained uncertain. could also value the private equity-owned com-
Terra is the largest gas producer in Colora- pany at over $2.5bn in a deal. Then in April, War-
do’s Piceance Basin. The company owns 370,000 burg Pincus put its portfolio company RimRock
net acres (1,497 square km) and produces about Oil & Gas up for sale, in its second attempt to sell
530mn cubic feet (15mn cubic metres) per day of the company in just over a year.
gas from more than 5,300 wells operating across Russia’s invasion of Ukraine has put addi-
the basin. tional pressure on gas supply, which was already
Within the Piceance Basin the majority of being squeezed by rising post-pandemic
Terra’s production is from the Williams Fork, demand. As a result, US natural gas prices are
where the company holds 200,000 net acres among those that have risen, more than dou-
(809 square km). The company also sees upside bling this year. This appears to be encouraging
potential in the deeper Mancos and Niobrara private equity firms to cash out on assets at high
shale plays, where it owns 170,000 net acres (688 valuations – a trend that was already underway
square km). prior to the Ukraine war.™

P8 www. NEWSBASE .com Week 21 26•May•2022