While drilling has slowed in the Uintah Basin in Utah, Wyoming Interstate Co. Ltd.’s (WIC) pipeline says there still is a need for takeaway capacity from the region and has filed an application at FERC for a compression expansion on its Kanda Lateral.
“There has been a slowdown in the pace of drilling in the region over the past nine months, [but] production growth in the Uintah Basin since the Kanda Lateral was placed in service [in 2007] combined with the fact that the proposed [compression] project is fully contracted indicates there is still a need for additional transportation takeaway capacity from the Uintah Basin area,” WIC told the Federal Energy Regulatory Commission in its application.
El Paso’s WIC pipeline proposes to install a compressor station — the Diamond Mountain Compressor Station in Uintah County, UT. The station would include two compressor units with a total of 20,604 nameplate hp, which would create up to 180,000 Dth/d of additional capacity on the Kanda Lateral [CP09-449]. The 124-mile, 24-inch diameter lateral transports approximately 400,000 Dth/d from near the Natural Buttes Field in Uintah County to an interconnect with WIC’s mainline in Sweetwater County, WY.
Bill Barrett Corp. has signed a precedent agreement for a maximum delivery quantity (MDQ) of 65 MDth/d of the expansion project’s capacity for a term of 10 years, and Anadarko Energy Services Co. has committed to a MDQ of 115 MDth/d for a term of 10 years.
WIC called on FERC to approve the compression expansion by no later than March 15 so it can start construction in April and place the facilities in service by Oct. 31, 2010.
The pipeline also asked FERC for a predetermination to roll in the costs of the compression expansion in its next Section 4 rate proceeding. WIC estimates the capital cost of the project at $48.6 million.
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