Shale Daily / NGI All News Access

MarkWest Expanding Marcellus Midstream Capacity

MarkWest Energy Partners LP has launched midstream expansions for gathering facilities in two areas of West Virginia and in southwestern Pennsylvania to support growing natural gas production for affiliates of Chesapeake Energy Corp. and Antero Resources Corp.

No financial details were disclosed.

Affiliates of Chesapeake signed a long-term fee-based arrangement for MarkWest to expand processing capacity for a dedicated area of about 185 square miles, which includes portions of West Virginia's Brooke, Ohio and Marshall counties, as well as Washington County, PA. Under the Chesapeake agreement, MarkWest would expand its processing capacity at the Majorsville, WV, complex to 1.1 Bcf/d, a jump of 400 MMcf/d from current processing capacity of 670 MMcf/d.

The expanded capacity would be provided in exchange for a "significant dedication of acreage made by Chesapeake to the Majorsville processing complex," MarkWest said. The Denver-based company also agreed to construct two 200 MMcf/d cryogenic gas plants scheduled to start up in late 2013 and mid 2014.

In the second agreement, MarkWest would expand existing gathering facilities in Doddridge and Harrison counties, WV, to support Antero Resources Appalachian Corp.'s growing gas output. Existing operations in southwestern Pennsylvania would be built out into a key area of West Virginia, and two large high-pressure gathering headers and associated compressor stations are to be installed under the Antero agreement.

The new gathering system would have the capacity to initially deliver more than 300 MMcf/d of Antero's gas to MarkWest's Sherwood gas processing complex. The first phase of the Antero expansion is expected to be completed in the third quarter in conjunction with the completion of the 200 MMcf/d Sherwood I processing facility (see Shale Daily, Jan. 3).

MarkWest previously said it would expand Sherwood to include a 200 MMcf/d Sherwood II facility, now set to come online in the second quarter of 2013. Once Sherwood II is completed, total capacity would be 400 MMcf/d.

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