Two sets of joint partners last week announced plans to upgrade and expand midstream services for the liquids-rich Eagle Ford Shale play in South Texas.

In the first announcement, by Enterprise Products Partners LP and Duncan Energy Partners LP, an expansion of natural gas processing and natural gas liquids (NGL) fractionation services is under way at the Shoup and Armstrong facilities. The upgrades are part of a more comprehensive plan to expand the partnerships’ midstream infrastructure in South Texas, they partnerships said last Wednesday.

“These expansions will not only give us the flexibility to accommodate more volumes but should also position us to capture additional value from the various physical qualities of the natural gas, particularly the high NGL content, that are characteristic of Eagle Ford Shale production,” said Enterprise CEO Michael A. Creel.

At the Shoup facility in Nueces County, “the focus is on modifying existing fractionation equipment” to increase capacity to 77,000 b/d. The expansion is scheduled to be completed by the end of June. Incremental volumes of NGLs to fill the additional capacity are expected to be supplied by six existing Enterprise natural gas plants currently feeding the facility. Production from these plants is expected to “increase significantly” over the next six months as the quantity and quality of the gas supplies increase, Enterprise noted.

Modifications to existing infrastructure at the Armstrong plant in DeWitt County would increase fractionation capacity to more than 20,000 b/d. The supply for the increased fractionation capacity would be enhanced by efficiency improvements at the onsite gas processing plant. Improvements in processing capabilities, which are scheduled to be completed by the end of the year, are designed to increase NGL recoveries, Enterprise noted. Additionally, the gas plant and fractionator upgrades would allow the Armstrong facility to handle more liquid-rich gas.

Enterprise also is moving forward on two key gas pipeline construction projects that would provide more than 200 MMcf/d of incremental transportation capacity in the region (see NGI, Dec. 7, 2009). The final segment of pipeline to complete the White Kitchen Lateral is scheduled for completion in mid-July.

The 62-mile White Kitchen Lateral, which runs through the heart of the Eagle Ford Shale in LaSalle and Webb counties, connects two of Enterprise’s existing 20-inch diameter pipelines located at the northern and southern edges of the play.

Construction also is nearing completion on the first segment of the east-west Eagle Ford Shale Mainline project. The 34-mile, 24-inch diameter pipeline, which would connect Enterprise’s and Duncan’s South Texas pipeline in southwest LaSalle County to the White Kitchen Lateral, is scheduled for completion by June 1.

In the second announcement, Kinder Morgan Energy Partners LP (KMP) and Copano Energy LLC on Friday formally announced agreements for Eagle Ford Gathering LLC, a new joint venture (JV) for the shale play. The partners had announced a letter of intent for the JV last November (see NGI, Nov. 16, 2009). Copano is to serve as operator and managing member of Eagle Ford Gathering.

“This new joint venture will provide producers in the western Eagle Ford Shale a new, fully integrated midstream alternative for their gathering, transportation, processing and fractionation needs, including access to multiple residue gas markets,” said Copano CEO Bruce Northcutt.

Because of the interest expressed by producers, KMP and Copano each have increased their committed capacity to 375,000 MMBtu/d from 150,000 MMBtu/d to Eagle Ford gathering for transportation on KMP’s Laredo-to-Katy pipeline and processing at Copano’s Houston Central processing plant.

Additionally, the partners said the first phase of construction is expected “to significantly extend beyond the original 22 miles previously announced.”

In connection with JV agreements, Copano and KMP also amended and extended their existing straddle processing and transportation agreements through the end of 2024.

“Representatives of Eagle Ford Gathering have been in negotiations with multiple producers regarding potential contracts for gathering, transportation and processing services,” they said.

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