Plains All American Pipeline (PAA) plans to build a 170-mile pipeline between Alfalfa County, OK, and its Cushing, OK, storage facility to service increasing Mississippi Lime crude oil production in northern Oklahoma and southern Kansas, the Houston-based company said.
The proposed pipeline, in conjunction with a previously announced Medford, OK-to-Cushing pipeline conversion, would provide approximately 175,000 b/d of crude oil transportation capacity, PAA said. The pipeline is expected to be completed in mid-2013. The new pipeline would share about 80 miles of right-of-way with the Medford-to-Cushing pipeline. PAA said it plans to extend the pipeline north from Alva, OK, into Kansas as demand warrants.
PAA also announced that it has entered into a long-term agreement to purchase SandRidge Energy Inc.'s production from a multi-county area around the proposed pipeline system.
SandRidge and Spain's Repsol YPF SA recently formed a joint venture (JV) to target the Mississippi Lime, which is also referred to by many in the industry as the Mississippian Lime (see Shale Daily, Dec. 27, 2011). SandRidge is to retain about 1.5 million net acres after the transaction closes, making it the largest leaseholder in the formation. SandRidge also has a JV with South Korean investment firm Atinum Partners Co. targeting the Mississippi Lime (see Shale Daily, Aug. 8, 2011).
Last month CenterPoint Energy Field Services LLC (CEFS) said it had begun assessing routes for a proposed gas gathering and processing system in the Mississippi Lime (see Shale Daily, Jan. 31). The White Eagle Gathering System would include up to 300 miles of high-pressure gathering lines and up to 200 MMcf/d of processing capacity with amine treating and nitrogen removal, depending on customer requirements, CEFS said. The system would interconnect with intrastate and interstate markets with natural gas liquids deliveries to the Medford Hub in Grant County, OK.
Tulsa-based midstream company Caballo Energy LLC recently said it was targeting the Mississippi Lime, as well as the Cana Woodford Shale, with its acquisition of Eagle Chief Midstream LLC, which owns a gas gathering and processing system in northwestern Oklahoma (see Shale Daily, Jan. 20).
According to company reports, the top five acreage holders in the Mississippian Lime are SandRidge Energy with 1.5 million net acres, followed by Chesapeake Energy with 1.4 million net acres, Repsol YPF with 363,636 net acres, Chapparal Energy with 244,000 net acres and Devon Energy with 200,000 net acres.