Compressor

The #3 compressor at Roswell (NM) Station has been taken down for unscheduled maintenance through next Thursday, El Paso said. The action reduced San Juan Crossover capacity by 30 MMcf/d, effective with Cycle 3 nominations Friday.

Hanover Compressor completed its previously announced acquisition from Schlumberger Ltd. of the Production Operators Corp. natural gas compression business as well as ownership interests in certain joint venture projects in South America and related assets for $761 million. Schlumberger received $270 million in cash, $150 million in long-term subordinated notes and 8.7 million shares of newly issued restricted Hanover common stock having a nominal value of $283 million. It also is entitled to receive a distribution of up to $58 million upon the occurrence of certain events relating to one of the joint ventures acquired by Hanover in the transaction. Hanover management reconfirmed its belief that the transaction will add annual revenue and EBITDA of at least $200 million and $90 million, respectively, within one year. As a part of a five-year alliance, Schlumberger has agreed to hold its ownership stake in Hanover for at least three years. In addition, Hanover has agreed to add a senior executive of Schlumberger to its board of directors. The initial designee is Rene Huck, president of reservoir evaluation and development for Schlumberger Oilfield Services. The transaction considerably enhances Hanover’s position in the global compression services and gas handling industry, significantly extends its reach and anticipated growth in large, newly opened markets overseas, and adds 900,000 hp to its compression fleet and an additional 800,000 hp through the South American joint ventures. “We believe this accretive multi-faceted transaction will generate strong revenue growth for Hanover over the next five years,” said Hanover CEO Michael J. McGhan.

El Paso said a compressor maintenance outage of its Leupp Station, previously scheduled for yesterday, has been postponed until further notice.

Hanover Compressor Co., which rents, repairs and services natural gas compressors worldwide, broadened its customer base last Thursday, agreeing to acquire several compression and gas handling joint venture projects of Schlumberger for $761 million. Hanover will pay Schlumberger $270 million in cash, $150 million in a long-term loan and issue shares worth $283 million, effectively giving Schlumberger a 10% stake in the company.

Hanover Compressor Co., which rents, repairs and services natural gas compressors worldwide, broadened its customer base Thursday, agreeing to acquire several compression and gas handling joint venture projects of Schlumberger for $761 million. Hanover will pay Schlumberger $270 million in cash, $150 million in a long-term loan and issue shares worth $283 million, effectively giving Schlumberger a 10% stake in the company.

Citing “lack of supply from CMS Energy” (Panhandle Eastern) at the Gas City (IN) Compressor Station interconnect on the Lebanon Lateral, Texas Eastern said it restricted scheduled volumes there for Wednesday’s gas day. Should conditions at the meter remain unchanged, the restrictions will remain in place today, Texas Eastern said. However, a Panhandle Eastern spokesman said the shortfall resulted from customers in the frigid Upper Midwest taking extra supplies from the pipeline and causing a pressure drop at Gas City. The pressure was back to normal by Wednesday afternoon and the shortfall resolved, he said.

As a follow-up to its gas quality advisory posted Tuesday (seeDaily GPI, Feb. 28), NGPL listedWednesday 12 points on its Louisiana Line (east of Compressor Station302 in Segments 23, 24 and 25) that are currently exceeding thepipeline’s limit of 1,050 Btus per cubic foot on receipts. EffectiveMarch 1, nominations at those points will not be confirmed untilfurther notice “unless acceptable mitigating actions have beenarranged,”

Transwestern reported a force majeure event Tuesday afternoon atStation 2 (Flagstaff, AZ) when the #2 compressor unit went down forrepairs. Downtime was estimated at 24-36 hours. West of Thoreaucapacity for today’s gas day is reduced by 70,000 MMBtu/d to about1,065 MMBtu/d.

Because El Paso’s Eunice Natural Gas Processing Plant justupstream of the TGT compressor station in Acadia, LA, is not fullyprocessing the gas stream available this winter (like others inSouth Louisiana), TGT said it is having operational problems due todownstream gas having excessive liquids. It notified customers thatgas received at any point, including points upstream of the EunicePlant, must not have a hydrocarbon dewpoint in excess of 10 degreesFahrenheit. Receipts not meeting that specification may be rejectedin whole or partially, TGT said.