NGI The Weekly Gas Market Report / NGI All News Access

Energy Transfer Approves Expansion of Barnett Shale Pipe Projects

With strong activity continuing in the Barnett Shale of Texas, Energy Transfer Partners LP's board of directors has approved two new pipeline projects, which include expanding its previously announced 264-mile intrastate pipeline project and constructing a new pipe to loop an existing one in the Fort Worth Basin production area.

Energy Transfer said the move following closing additional capacity commitment with a large producer in the Barnett Shale for up to 250,000 MMBtu/d and interest from several other producers. Under the expansion, the partnership agreed to increase the size of the pipeline from the previously announced 36 inches to 42 inches for about 131 miles (see NGI, April 25). The expansion is not expected to delay the anticipated time to complete the project.

With this increase in size, the 264-mile pipeline will now have approximately 240 miles of 42 inch pipe and 24 miles of 30 inch pipe. The board also approved an additional $81.5 million in capital expenditures to cover the cost of this expansion, bringing the total expected cost to $535.5 million.

The board also approved looping the first 24 miles of its existing 55-mile, 24-inch pipeline in the Fort Worth Basin, which became commercially operational in late May at nearly full capacity. The looping and the addition of up to 12,000 horsepower of incremental compression is expected to provide additional upstream capacities to accommodate the increased volumes in the Fort Worth Basin production area. The estimated cost to complete this project is approximately $32.1 million.

"The Barnett Shale continues to exceed everyone's expectations," said Roy Patton, senior vice president of subsidiary Energy Transfer Fuel. "We have been successful in the area because we have been so proactive in building both the upstream and downstream infrastructure to meet our customers' needs. As production levels continue to grow, these two expansion projects will help attract additional customers to our pipeline."

In July, XTO Energy Inc. signed a 10-year agreement with Energy Transfer for more than 700 MMcf/d of firm takeaway capacity on the new pipeline, beginning in 2007 (see NGI, July 11). The agreement inked with Energy Transfer will increase XTO's takeaway capacity from the Freestone Trend and Barnett Shale project to approximately 1.10-1.45 Bcf/d by the end of the decade, the producer noted.

©Copyright 2005 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1266
Comments powered by Disqus