Trace Midstream Partners, LLC and Gemini Midstream Holdings Inc. will merge to focus on expansion of the 50-mile, 1.2 Bcf/d capacity Gemini Carthage Pipeline (GCP), which transports dry natural gas from the Texas portion of the Haynesville Shale to the Carthage, TX area.
Trace and Gemini, both portfolio companies of private equity firm Quantum Energy Partners, said Friday they will combine management teams to operate as Trace Midstream.
“Since its initial in-service date of May 2019, GCP has seen a significant ramp in volumes from its two anchor producers,” Rockcliff Energy LLC and Tanos Exploration LLC, said Trace CEO Josh Weber. “GCP offers its customers access to premium and growing liquefied natural gas [LNG] export and industrial markets along the Texas and Louisiana Gulf Coast.”
Trace also has begun construction of the 36-inch diameter, 150-mile Gemini Gulf Coast Pipeline (GGCP), which will be capable of delivering 1.5 Bcf/d of gas to the Beaumont, TX area.
Phase 1 of GGCP is expected to enter service in May 2020, Trace said, adding that the firm will remain headquartered in Houston and continue to operate its East Texas assets from its field office in Marshall, TX.
Trace joins other midstreamers such as Tulsa-based Williams, in its efforts to connect gas supply from the Haynesville to burgeoning LNG and industrial gas demand on the Gulf Coast.
U.S. LNG exports are expected to continue growing and remain competitive through 2030, before leveling off through 2050, according to the Energy Information Administration’s Annual Energy Outlook 2020 published on Wednesday.
Despite the pressure of current and forecast low natural gas prices on producers in gassy shale plays such as the Haynesville and Marcellus, natural gas permitting has continued to rise in both areas, according to recent analysis by Evercore ISI.