Kinder Morgan Energy Partners LLC and Copano Energy, L.L.C. plan to expand the scope of their Eagle Ford Gathering LLC joint venture.
Eagle Ford Gathering will provide more than 200,000 MMBtu/d of incremental gathering and processing capacity to producers in the Eagle Ford Shale through construction of additional pipeline facilities and a long-term agreement with Formosa Hydrocarbons Co. for additional processing and fractionation services.
In addition to 111 miles of pipeline now under construction, Eagle Ford Gathering will build a 54-mile, 24-inch crossover pipeline between existing Kinder Morgan pipelines, and a 20-mile, 20-inch pipeline that will enable the joint venture to deliver gas to Formosa. Kinder Morgan will build and operate the two additional pipelines. Eagle Ford Gathering has an agreement with Formosa to support its gas processing and fractionation needs and expand operational flexibility.
Duane Kokinda, president of Kinder Morgan’s Texas Intrastate Pipelines Group, said, “This significant new agreement with Formosa will provide long-term supplies of NGL feedstocks and also make additional processing and fractionation capacity available to the joint venture as early as the fourth quarter. The crossover pipeline will have capacity in excess of 400 MMcf/d, which will give the joint venture additional options to provide services to Eagle Ford Shale producers.”
“This expansion of our joint venture with Kinder Morgan provides significant additional capacity for Eagle Ford Shale producers and will allow the joint venture to more fully utilize the 600 MMcf/d of capacity on its 30-inch pipeline,” said R. Bruce Northcutt, Copano Energy’s president and CEO. “We expect this additional capacity to be substantially contracted for by early 2011. The new long-term relationship with Formosa brings additional market diversity for the expected growing volume of natural gas liquids from this play.”
Kinder Morgan and Copano will invest $100 million to build the crossover pipeline and related facilities which they expect to complete by year-end. Eagle Ford Gathering’s previously announced $175 million, 30-inch pipeline in the western portion of the shale play is under construction and remains on schedule to be completed in the third quarter. Copano will serve as operator of the 30-inch pipeline and is managing member of Eagle Ford Gathering.