Summit Midstream Partners, LP has executed an agreement with XTO Energy Inc. to develop, own and operate a new associated natural gas gathering and processing system servicing acreage located in the northern Delaware Basin in Eddy and Leacounties in New Mexico.
Summit will initially construct a gathering and processing system with high and low pressure gathering and discharge pipelines, two compressor stations and a cryogenic processing plant with 60 MMcf/d of processing capacity. Summit’s processing complex will have the ability to be expanded to more than 600 MMcf/d of processing capacity to meet customer needs as warranted. The company expects to process production from XTO and other nearby producers. The initial phase of the project is expected to be placed in service on or before June 1, 2018 at a total investment cost of approximately $110.0 million.
“Today’s announcement represents a significant step for Summit,” Steve Newby, Summit Midstream Partners’ President and Chief Executive Officer, said. “This greenfield development project establishes Summit as a key midstream service provider in the Delaware Basin, one of the most active, economic and exciting plays in North America. This initial system is expected to provide SMLP with a platform for significant organic expansion across crude oil, natural gas and produced water gathering and/or processing services for years to come. We look forward to executing additional commercial agreements with other producers in the area.”