Santa Fe Midstream plans to form a joint venture with Vermilion Cliffs Partners to develop crude oil, natural gas and water midstream infrastructure in the Delaware Basin in Reeves and Culberson counties in West Texas.
Vermilion will contribute a 20-inch natural gas pipeline and associated facilities in Culberson County and dedicate acreage to the venture. Santa Fe will supply additional capital needed to construct gathering pipelines and a 200 MMcfd cryogenic gas processing plant in Culberson County. Santa Fe will be the operator of the midstream assets.
Due to ongoing growth and development of the Delaware Basin, significant capital investment in new midstream infrastructure is needed in Reeves and Culberson counties. The Santa Fe-Vermilion joint venture will offer natural gas gathering and processing, crude oil gathering and produced water gathering to disposal wells for producers in the Delaware Basin.
Natural gas residue will be delivered to downstream interstate and intrastate pipelines serving Mexican, Western United States and Texas markets. NGL’s will be delivered to pipelines for transportation and fractionation at Mont Belvieu, TX.
“This joint venture will provide superior midstream solutions for producers in Culberson and Reeves counties,” said Santa Fe’s founder and Managing Partner Amer Rathore.
Jeff Cook, a founding partner of Vermilion, said, “The Santa Fe-Vermilion midstream joint venture is well positioned to deliver exceptional service and flexibility for producers in the southern Delaware Basin. Vermilion Cliffs Partners is honored to join the fine team at Santa Fe Midstream to pursue this venture.”