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Energy Transfer to Lay More Eagle Ford Pipe

Energy Transfer Partners LP will construct two pipelines in support of new long-term agreements to provide transportation services from the Eagle Ford Shale in South Texas. The pipelines will expand the partnership's existing midstream infrastructure in the region, Dallas-based Energy Transfer said Monday.

The two systems will consist of more than 130 miles of 20- and 24-inch diameter pipeline capable of transporting up to 700 MMcf/d of liquids-rich natural gas.

The 50-mile, 24-inch diameter Dos Hermanas Pipeline will have a capacity of about 400 MMcf/d and will originate in northwest Webb County, TX, and extend to the partnership's existing Houston Pipeline rich gas gathering system in eastern Webb County, TX. It is expected to be completed by December. As part of the project, approximately 6,000 hp of compression will be added to the Houston Pipeline system.

The initial phase of the Chisholm Pipeline will consist of about 83 miles of 20-inch diameter pipeline from DeWitt County, TX, to the partnership's LaGrange Processing Plant in Fayette County, TX. It will have an initial capacity of 100 MMcf/d with anticipated capacity expansion exceeding 300 MMcf/d, Energy Transfer said. The project will utilize existing processing capacity at the partnership's LaGrange Plant. After processing, residue volumes will be transported on the partnership's Oasis Gas Pipeline. This phase of the pipeline is expected to be in service by the second quarter of 2011.

"The Dos Hermanas and Chisholm Pipelines are exciting milestones as they mark significant organic growth projects in the emerging Eagle Ford Shale," said Energy Transfer's Brian Beebe, vice president of commercial operations. "These liquid-rich natural gas pipelines are both strategic complements to our existing infrastructure in South Texas and provide unequaled access to numerous processing plants, as well as multiple downstream markets through our partnership's extensive intrastate network."

The liquids-rich area of the Eagle Ford play has been attracting a great deal of interest lately from producers who are seeking better returns than those offered by dry gas production. Last week China's CNOOC Ltd. (China National Offshore Oil Corp.) struck a deal in the Eagle Ford with Chesapeake Energy Corp. valued at more than $2 billion (see Shale Daily, Oct. 12a). Also last week, Calgary-based Talisman Energy Inc. and Norway's Statoil ASA announced a joint venture to acquire 97,000 net acres in the Eagle Ford from Enduring Resources for US$1.325 billion (see Shale Daily, Oct. 12b).

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