Phases

Units of Royal Dutch Shell plc and Kinder Morgan Inc. are forming a partnership to develop a natural gas liquefaction and export plant in two phases at Southern LNG Co. LLC’s Elba Island LNG Terminal near Savannah, GA.

DCP Midstream’s Sand Hills Pipeline has initiated natural gas liquids transport service from the Eagle Ford Shale. DCP is opening Sand Hills in phases, with this first segment in South Texas online. By the end of 2012, DCP will have completed Sand Hills to connect directly into Mont Belvieu, TX. “When finished, Sand Hills Pipeline will be a major link between the liquids-rich Eagle Ford and Permian producing regions and growing Gulf Coast markets,” said DCP CEO Tom O’Connor. Construction activities continue on the second phase of Sand Hills for Permian Basin service. This phase is expected to enter service by the second quarter of 2013. Sand Hills will consist of 720 miles of 20-inch diameter pipeline with an initial capacity of more than 200,000 b/d, which can grow to 350,000 b/d with the installation of additional pump stations (see Shale Daily, Aug. 19, 2011).

PDC Mountaineer (PDCM), a joint venture of Petroleum Development Corp. and Lime Rock Partners V LP, will pay $152.5 million to National Grid plc for Seneca-Upshur LLC, including the rights to an estimated 90,000 net acres in the Marcellus Shale in north central West Virginia, the company said Monday. Closing is scheduled for Monday (Oct. 3), with an effective date of July 1, 2011.

California Gov. Arnold Schwarzenegger announced Tuesday more cash from the federal dole for energy programs — $185 million in two phases for weatherization programs, which are part of the state’s three-year $3.1 billion energy efficiency programs authorized for the major private-sector utilities.

Who knows what you will find these days when developing a new pipeline route? BP and Shell Gas Transmission reported late last week that while surveying a route for the proposed Okeanos Gas Pipeline, the companies stumbled across the long-sought wreckage of the German World War II submarine U-166 at the bottom of the Gulf of Mexico. The U-166 was reportedly the only submarine sunk in the Gulf during the war.

The cash market entered one of its leveling-off phases Thursdaywith flat prices prevailing at a majority of points. A little earlystrength on the futures screen helped buoy physical gas at first,but toward the end of the morning cash numbers were following thescreen lower “step for step,” a Gulf Coast producer said. Onceagain there was essentially nothing to influence trading beside thescreen, she added, dismissing the AGA storage report Wednesdayafternoon as a non-event.

A white paper released by Prosper Business Development Corp.outlines three phases of revolution occurring in the energyindustry and explains three mistakes marketers must avoid to ensuresuccess in the competitive marketplace. The paper addressesdifferences from telecommunications deregulation and warns of ashakeout for energy marketing executives who fail to respond to thederegulating market.