Regency Energy Partners LP plans to construct an approximately $44 million pipeline extension of its Nexus Gathering System in North Louisiana. Called the Logansport Expansion, the project will add about 300 MMcf/d of gathering capacity to the system.
The expansion will increase the overall deliverability of the Nexus Gathering System by adding approximately 17 miles of 20-inch diameter pipe, as well as associated compression and dehydration facilities. It will provide gathering customers with additional takeaway options in DeSoto Parish, LA, and Shelby County, TX — areas currently experiencing significant drilling activity — and expand Regency’s presence in the Haynesville Shale, the company said. The expansion will transport gas gathered by Nexus to a 300 MMcf/d interconnect with CenterPoint Energy Gas Transmission’s Line CP.
“With the rapid growth in the Haynesville Shale, the Logansport Expansion is intended to meet new gathering needs from our producer customers,” said Regency CEO Byron Kelley. “Once complete, the expanded Nexus Gathering System will be well positioned for future growth, as it is the first of several anticipated expansions on this gathering system.”
The expansion will be funded partially with proceeds from Regency’s recent private placement, with the remainder financed under the company’s revolving credit facility. The contracts will contribute additional fee-based margins to the company’s gathering and processing segment once the project comes online. Regency has kicked off construction efforts on the project; completion is expected in early 2010.
Last Wednesday CenterPoint Energy Field Services Inc. said it will provide long-term gathering and treating services to subsidiaries of EnCana Corp. and Royal Dutch Shell plc for their Haynesville Shale production (see Daily GPI, Sept. 11). And recently Energy Transfer Partners LP’s proposed 180-mile Tiger pipeline to tap the Haynesville Shale received another vote of confidence in the form of a 10-year contract to transport 300 MMcf/d, bringing total capacity commitments on the project to at least 1.8 Bcf/d (see Daily GPI, Sept. 9).
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