Houston-based Genesis Energy LP is holding an open season through Dec. 22 to test support for a 140-mile-long crude oil gathering system in Wyoming’s Powder River Basin (PRB).
The system as designed would include a transmission pipeline running through portions of Campbell, Converse, Niobrara and Platte counties with access to multiple downstream markets via the Pronghorn Rail loading terminal, which is connected to the Union Pacific and BNSF railroads.
The gathering system is supported by an undisclosed PRB operator, which plans to dedicate 150,000 acres over 10 years. Additionally, the operator extended an existing contract, in which it previously dedicated 150,000 acres for 10 years. Production from the previously dedicated acreage currently is gathered by a third party.
“Our proposed gathering system will enhance our connectivity directly to well pads, thus eliminating the need for trucking and provide a seamless wellhead to market pipeline solution,” said CEO Grant Sims. “We are excited to expand our relationship with one of the leading operators in the basin, which now has made long-term commitments of the production from approximately 300,000 acres for downstream transportation on our existing infrastructure.
“The basin continues to see increasing drilling activity and our existing Powder River Basin Pipeline is well positioned to provide reliable deliveries to multiple attractive downstream markets.”
The U.S. onshore drilling rig count has been rising slowly, with the PRB gaining steam. For the week ended last Wednesday (Nov. 22), the PRB added six rigs week/week, according to Baker Hughes Inc.
Genesis subsidiaries own more than 300 miles of legacy oil gathering pipelines in Converse and Niobrara counties, along with four truck and storage terminals near the Wyoming towns of Wright, Bill, Douglas and Guernsey.
It also has 800,000 bbl-plus of storage capacity in service or under construction, with permits in hand to expand capacity by more than 1 million bbl in Campbell, Converse and Platte counties.