OGJ Newsletter

Jan. 16, 2012

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TRANSPORTATIONQuick Takes

EPP NGL shippers double MAPL expansion commitments

Enterprise Products Partners LP shippers that executed 10-year, firm NGL transportation agreements in May 2011 on its Mid-America Pipeline Rocky Mountain expansion project exercised options increasing total commitments by roughly 115% to 82,500 b/d. Original commitments totaled 38,500 b/d.

The expansion will loop the existing system with 263 miles of 16-in. OD pipeline, as well as modifying pump stations. Capacity will be filled by new gas processing plants being constructed in the Uinta, Piceance, and Greater Green River basins.

EPP described the expansion as complementing its Texas Express Pipeline joint-venture with Enbridge and Anadarko Petroleum Corp. to build a 580-mile NGL pipeline from Skellytown, Tex., to Mont Belvieu, Tex. (OGJ Online, Sept. 6, 2011).

The US Federal Energy Regulatory Commission approved the MAPL expansion in August 2011. EPP expects to place it in service third-quarter 2014.

MAPL's committed shipper transportation rate to Mont Belvieu, subject to annual escalation, is 15.1¢/gal.

Alaska governor, majors' executives discuss ANS gas

Alaska Gov. Sean Parnell met with chief executives from BP PLC, ConocoPhillips, and ExxonMobil Corp. in Anchorage to discuss commercializing the Alaska North Slope's gas reserves. Parnell requested the Jan. 5 meeting after calling on the three major ANS gas reserve holders' to work together on developing an LNG export project aimed at Asia's growing markets.

"We had a productive discussion about how to get alignment between the companies and grow Alaska's economy through oil and gas development," Parnell said following the 2-hr meeting with BP's Bob Dudley, ConocoPhillips's James Mulva, and ExxonMobil's Rex Tillerson.

The executives briefed the governor on work their companies had done since his request, Parnell stated. The meeting's agenda also included an update on ExxonMobil's Point Thomson gas project and a discussion of the state's goal of bringing oil production back to 1 million b/d.

Parnell and other state officials have noted that declining crude production is pushing the Trans-Alaska Pipeline System from Prudhoe Bay to Valdez toward its minimum effective operating level. Alaska produced 17.539 million bbl, or an average 565,774 b/d, of crude during October 2011, according to the US Energy Information Administration.

Parnaiba Devonian shale gas output authorized

Brazil's secretary of state for the environment and natural resources of Maranhao issued a preliminary license for the development of production and transport of gas in Gaviao Real and Gaviao Azul fields in northeastern Brazil's Parnaíba basin.

The license confirms the environmental viability of the venture, which will produce and process natural gas for the MPX Thermoelectric Power Plants in the region.

Gas production should start in the second half of 2012 and could eventually reach as much as 212 MMcfd, said operator OGX Petroleo e Gas Participacoes SA, Rio de Janeiro.

The detailed design and acquisition of equipment for the gas treatment unit being built in the region are moving ahead. The processing to remove the liquid from the gas produced, and to filter and heat the gas will take place in the GTU.

The production of gas from the two fields will be capable of doubling onshore production of natural gas in Brazil, OGX said (OGJ Online, Nov. 17, 2010).

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