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Williams to Gather, Process Deepwater Production

Williams to Gather, Process Deepwater Production

Williams has been selected in a "landmark transaction" to install the infrastructure, including gathering lines and onshore processing, to service new deep water development in the Nansen and Boombang Fields in the East Breaks area of the Gulf of Mexico.

Williams was selected by operator Kerr-McGee Oil & Gas, Enterprise Oil Gulf of Mexico Inc. and Ocean Energy to gather and transport oil and natural gas production from the two developments in 3,700 feet of water about 150 miles south of Houston. To accommodate production, Williams will install new offshore pipelines and build a 300 MMcf/d gas processing plant adjacent to its existing liquids separation facility near Markham, TX.

"This is a landmark transaction for Williams because it positions us to be one of the largest independent service providers in the deepwater Gulf of Mexico," said Alan Armstrong, vice president of gathering and processing for Williams' midstream operations. "We're also designing our infrastructure and logistics to accommodate other prospects that may be developed in the East Breaks corridor."

Armstrong said that "from a bottom line perspective, we foresee enough near-term activity in the deep water to more than double the operating profit of the gathering and processing portion of our midstream business by 2005."

Construction of the projects, which will cost more than $200 million, is scheduled for completion in the fourth quarter of 2001. The gas processing plant connected to Williams' Central Texas Gathering System will be capable of extracting about 20,000 barrels a day of natural gas liquids for ultimate delivery to Mont Belvieu, TX through a new pipeline lateral that will interconnect with Seminole Pipeline. Other construction projects will include the following:

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