Processing

Industry Briefs

A subsidiary of Coastal Field Services has purchased the GilmoreNo. 3 gas processing plant, near Edina, TX, in Hidalgo County fromPG&E Gas Transmission-Texas (PG&E-GTT). The plant wasconstructed in 1997 and has a capacity to extract 6,000 b/d of gasliquids from inlet volumes of up to 125 MMcf/d of gas. Theagreement, signed Nov. 1, also provides for Coastal to controlcapacity both upstream of the plant and exiting the plant.PG&E-GTT will continue to own and operate the Gilmore No. 1 andNo. 2 plants, which have capacity to extract 6,800 barrels per dayof gas liquids from combined inlet volumes of up to 140 MMcf/d.PG&E-GTT also will continue as operator for the Gilmore No. 3plant. “This acquisition reflects Coastal’s strategy of integratingnatural gas infrastructure in areas where Coastal has significantexploration and production interests,” said Coastal CEO David A.Arledge. “Due to ongoing drilling successes and recentacquisitions, South Texas is one of Coastal’s fastest-growingnatural gas production areas.”

November 5, 1999

Calpine Plans New Texas Cogen; Adds California Plant

Calpine Corp., Texas’ largest independent power producer,announced plans last week to build, own and operate an 800 MWnatural gas-fired cogeneration power plant at Bayer Corp.’schemical facility in Baytown, TX. Permitting for the $335 millionfacility is under way, the company said. The plant is expected tobegin commercial operation in late 2001.

October 4, 1999

Transportation Notes

Destin Pipeline reported experiencing problems at both the MainPass 260 platform and the BP Amoco Pascagoula Processing Plant with”some objectionable substance” flowing into the system. It cut theVKGS Main Pass 260 point to 50% of scheduled volumes Monday. Thepoint was shut in Tuesday and no nominations are being acceptedthere until further notice, Destin said.

September 22, 1999

Transportation Notes

The Amoco processing plant serving Destin Pipeline is havingproblems with its liquids handling facility, reducing the handlingcapacity by 50% as of Monday, according to the Destin bulletinboard. Amoco estimates the reduction will last about a month. Thereis enough remaining capacity to process current daily liquidsvolumes, according to Destin, but if those volumes increase beyondAmoco’s capabilities the pipeline “could be forced to take furtheraction should the quality of the gas not meet market requirements.”

May 5, 1999

Transportation Notes

Texaco, operator of Sea Robin Processing Plant, has notified SeaRobin Pipeline that the plant will be out of service formaintenance for about six weeks starting April 1. The pipeline willnot generate LTA nominations during that period.

March 24, 1999

Transportation Note

Constraints will be minor today at the Opal (WY) processingplant as Williams Field Services begins testing and maintenance.But at least half of the plant’s current 540 MMcf/d activity willbe off the market Tuesday as the plant is shut down for 12 hours.Reductions June 17-24 will be about 75 MMcf/d.

June 15, 1998

Transportaion Notes

Nautilus Pipeline said it is on track to begin receiving gasagain at Ship Shoal 207 at the start of the May 1 gas day.Processing of a large condensate slug at Exxon’s Garden City Plantonshore Louisiana (see Daily GPI, April 17) is expected to becompleted by Thursday.

April 29, 1998

Duke Growing Pipe Presence in TX, LA

Duke Energy Field Services further expanded its South Texasgathering and processing assets with the acquisition of theBrooks-Hidalgo Pipeline System from subsidiaries of Aquila Energyand Mitchell Energy effective April 1.

April 21, 1998

UPR Examining Possible Midstream Asset Sale

Union Pacific Resource has reiterated its intention to examine apossible sale of its gas gathering and processing business orselected non-core assets as part of a “deleveraging” programfollowing its recent $3.5 billion purchase (including assumption ofdebt) of Norcen Energy. At the time of the Norcen deal, UPR said itintended to sell $500-$700 million in assets to cut its debt toequity ratio, which ballooned to 73% following the Norcen deal fromabout 40%. But the company has valued its midstream assets, whichare located in Texas, Louisiana, Wyoming and Colorado, at about $2billion. The assets produced about $150 million in pretax operatingincome in 1997. The company has 25 operating plants and relatedpipeline facilities. A UPR spokesman said the company is justbeginning to evaluate its options but noted the market formidstream assets has been hot. UPR’s announcement follows similarplans announced recently by Aquila Gas Pipeline and EquitableResources. “These assets have been selling at a much higher cashflow multiple than E&P assets.”

April 2, 1998

Transportation Notes

KN’s Bushton Plant will have a Lean Side Outage through March 5.Only the Lean Side Processing capabilities will be affected.

March 3, 1998
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