Crestwood to buy midstream assets, add plant

By OGJ editors
HOUSTON, Feb. 24
-- Crestwood Midstream Partners LP, Houston, plans to build a gas processing plant to expand midstream properties it has agreed to buy in the Texas Panhandle from Frontier Gas Services LLC, Tulsa, in a deal that includes assets in the Fayetteville shale in Arkansas.

Existing Panhandle properties in the $338 million purchase include a 36 MMcfd cryogenic processing plant and a 28-mile pipeline system handling production from the active Granite Wash play. Crestwood expects the new plant to come on stream by yearend with capacity of 60 MMcfd.

The Fayetteville shale assets include about 127 miles of high and low-pressure gathering pipelines with capacity of about 510 MMcfd, treating capacity of 165 MMcfd, and 35,000 hp of compression.

Crestwood, a master limited partnership formed by affiliates of First Reserve Corp., agreed to pay Frontier an additional $15 million if operational targets are met within 6 months of the sale closing date.

Crestwood also owns fee-based midstream property in the Barnett shale of North Texas.

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