Meritage Midstream Services II LLC said this week it expects to more than double its natural gas processing capacity in Wyoming’s Powder River Basin (PRB) if a new cryogenic plant comes online in the third quarter as expected.
Meritage subsidiary Thunder Creek Gas Services LLC is constructing the 200 MMcf/d facility in Converse County, several miles west of Douglas. The Steamboat I facility would expand processing capacity on Meritage’s “supersystem” and boost overall cryogenic capacity in the basin to 380 MMcf/d.
The Steamboat complex is also large enough to accommodate two more 200 MMcf/d processing trains “as customer demand warrants,” Meritage said. The facility is 100 miles south of the company’s 50 Buttes processing plant in Campbell County and is backed by multiple long-term dedications of more than one million acres.
Steamboat would be served by a 20-inch diameter trunk line currently under construction that would tap into Thunder Creek’s gas gathering system. The new plant would also connect to the Wyoming Interstate Co. mainline system for residue gas.
Denver-based Meritage, which is backed by energy-focused private investment firm Riverstone Holdings LLC, operates more than 1,200 miles of pipeline and has another 190 miles under construction in the PRB, where it also provides natural gas liquids and oil services.
The Steamboat facility is part of a broader infrastructure build-out underway in parts of the Rockies as producers have increased their activity in both the PRB and Colorado’s Denver-Julesburg Basin. In the Niobrara formation, one of seven major onshore unconventional plays tracked each month by the Energy Information Administration, both oil and natural gas production are again expected to increase next month to about 752,000 b/d and 5.54 Bcf/d, respectively.
Meanwhile, year/year rig counts in the region have increased. At the end of last week, there were 30 rigs working in Wyoming, compared with 26 at the same time last year. In Colorado, 33 rigs were working, up from 30 in early May 2018, according to data from Baker Hughes, a GE Company.
Much of the midstream growth in the PRB is coming in the southern part of the basin, in Campbell and Converse counties, according to an analysis late last year by RBN Energy LLC. For example, about 565 MMcf/d of existing processing capacity could more than double in the region based on the plans of at least six operators, including Meritage.
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