Enterprise enters long-term Eagle Ford shale agreement

Christopher E. Smith
OGJ Pipeline Editor

HOUSTON, Sept. 15 -- Enterprise Products Partners LP entered into a long-term agreement to provide natural gas transportation and processing services on dedicated acreage owned by one of the largest and most active producers developing the Eagle Ford shale. The agreement covers more than 150,000 acres in the play.

Enterprise declined to name the producer but has publicly identified Anadarko Petroleum Corp., Petrohawk Energy Corp., ConocoPhillips, and Apache Corp., among others, as potential partners for its midstream services. Anadarko holds 350,000 acres in the Eagle Ford shale. Petrohawk’s holdings in the play reached 210,000 acres in August. ConocoPhillips holds 300,000 acres, and Apache 400,000.

Stretching from the Mexico border along the Gulf Coast to near Louisiana, the Eagle Ford shale covers more than 10 million acres in Texas and lies beneath or near Enterprise’s assets in the region. Enterprise said the proximity would require it make only modest capital expenditures to begin providing the transportation and processing services required under the agreement.

The bulk of the modifications to Enterprise’s existing system would consist of filling gaps in its current gas gathering system, the company said. Enterprise would not comment regarding either the expected pipeline mileage required or the timeframe over which the work would be completed.

Enterprise completed expansion of two of its seven South Texas processing plants during first-quarter, increasing its processing capacity in the region to more than 1.5 bcfd, and said these expansions will largely address any capacity needs brought about by the new agreement. Enterprise increased capacity at the Shilling plant in Webb County, Tex., to 110 MMcfd from 60 MMcfd and expanded capacity at its Thompsonville natural gas processing plant in Jim Hogg County, Tex. to 330 MMcfd from 300 MMcfd (OGJ Newsletter, Mar. 23, 2009).

Contact Christopher E. Smith at chriss@ogjonline.com.

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