GreenHunter Resources Inc. has formed a hydrocarbons division to provide producers in the Appalachian Basin with logistical solutions for handling oil, condensate and natural gas liquids (NGL) as volumes continue to rise.
Since it first moved into the region in 2011 to provide water and waste management services to operators, GreenHunter has sold many its other assets to capitalize on growth in the Marcellus and Utica shales (see Shale Daily, Feb. 6). At the same time, as the midstream focus gradually switches from gathering and processing capacity to handling and marketing dry/wet gas and oil, NGLs and condensate, producers have searched for more ways to move their products from the basin.
GreenHunter Hydrocarbons LLC, announced Wednesday, is to focus on storage, transportation, processing and marketing through the parent company's existing asset base, including six barge terminals along the Monongahela, Allegheny and Ohio rivers.
"Higher quality Bakken and Eagle Ford condensates, which now saturate the Gulf Coast market, are lowering demand for Marcellus and Utica condensates," said division manager Terry Clark. "Unprocessed condensate pricing will continue to be volatile as shale production increases and Marcellus and Utica condensates’ Reid vapor pressure exceed market requirements and limits."
Providing stabilization and more ways to get condensates to processors should help offset that glut and the widening price discounts in the region, Clark said, while moving more condensates via pipeline could help reduce "transportation liability."
GreenHunter isn't alone in its efforts to deal with growing Appalachian production. A group of the region's top midstream executives said a big focus going forward is to move more liquids from the basin (see Shale Daily, March 10). The Utica alone could be producing up to 100,000 b/d of condensate in the next three to five years.