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Meritage Midstream expands South Texas gathering line

Christopher E. Smith
OGJ Pipeline Editor

HOUSTON, July 15 -- Meritage Midstream Services LLC, Golden, Colo., plans to build a rich-gas gathering system, the Cuervo Creek Pipeline, in Webb County, Tex. The 60-mile, 16 in. OD system will traverse more than 1,300 sq miles of gas prospects from Encinal south to Laredo, including the Eagle Ford shale, and will include multiple downstream interconnects. The Cuervo Creek line will have an initial capacity of 150 MMcfd and is expected to enter service in this year’s fourth quarter.

Escondido Resources II LLC will serve as the system’s anchor tenant and will also have firm capacity on Meritage’s existing Eagle Ford Escondido Gathering System (EEG) to move its Eagle Ford volumes. Escondido will dedicate about 33,000 acres to Meritage including deep and shallow rights in the Eagle Ford, Escondido, and Olmos formations. Meritage expects to increase its rich-gas gathering capacity again in 2012 to accommodate the developing shallow gas plays.

Escondido said it is currently producing more than 50 MMcfd with plans to bring on additional rigs and expand its drilling activity.

EEG serves multiple producers working in dry-gas windows with more than 100 miles of high-pressure gathering lines and 145 MMcfd in treating capacity at its facility near Laredo. Meritage completed its Fasken Ranch gas lateral pipeline, an extension to EGG in Webb County, in November 2010 (OGJ Online, Nov. 18, 2010).

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


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