CenterPoint Energy Inc. said Thursday its natural gas gathering volumes rose significantly during the first quarter, with shale gas accounting for most of the total as traditional basins fell. The company also continued to make progress on gathering systems in the Haynesville Shale.
“This was a good quarter for our company,” CEO David McClanahan said. “Our field services unit continues to realize growth from the investments we have made in the Haynesville Shale. I remain optimistic about future investment opportunities in our businesses.”
The Houston-based company reported net income of $148 million (35 cents/share), an increase of nearly 30% when compared with the $114 million (29 cents/share) earned in the year-ago quarter. Operating income climbed about 2% to $364 million compared with $357 million for the same quarter in 2010.
During an earnings conference call McClanahan said average natural gas gathering volumes were a little more than 2 Bcf/d in 1Q2011, an increase of about 43% from the same quarter one year ago. He said shale reserves accounted for about 60% of the total volume — compared with 32% last year — and that volumes from traditional basins were down about 15% from 1Q2010, and 5% lower than 4Q2010.
“Drilling activity in [traditional basins] continues to be modest,” McClanahan said.
McClanahan said the company continued to make progress on its Magnolia and Olympia gas gathering systems. He said the first 700 MMcf/d phase of the Magnolia System was complete except for some well connections. During 1Q2011 the company made “substantial” progress toward completing the 600 MMcf/d Olympia System, he said. A 200 MMcf/d expansion of the Magnolia System was also moving forward.
“Both [projects] are on schedule and on budget,” McClanahan said.
McClanahan added that throughput on the Magnolia System averaged approximately 550 MMcf/d during 1Q2011, and the Olympia System averaged more than 300 MMcf/d. “We expect throughput on these two systems to increase over the course of the year and be at system capacity by early 2012,” he said.
CenterPoint Energy Field Services Inc. signed a 15-year contract with a Royal Dutch Shell subsidiary and Encana Corp. in May 2010 to expand facilities in the Haynesville Shale play (see Shale Daily, April 26).
“As you may recall, the Shell and Encana contracts provide for a step-up of annual throughput guarantees as certain milestones are reached,” McClanahan said. “Various milestones are expected to be achieved during 2011, and by early next year the annual throughput guarantees will be at the contracted capacities.”
© 2023 Natural Gas Intelligence. All rights reserved.
ISSN © 2577-9877 | ISSN © 2158-8023 |