Nuevo Midstream LLC plans to increase processing and treating capacity at its Ramsey plant in the Delaware basin near Orla, Tex.
Nuevo of Houston bought a cryogenic processing plant with capacity of 100 MMcfd and a second amine treating plant with a capacity of 475 gpm, both to be installed and operational in second-quarter 2012, the company said.
Plans call for Nuevo to extend its Ramsey gathering system with additional large-diameter gas gathering lines and an interconnect to El Paso’s natural gas pipeline. The Ramsey system crosses through Eddy County in southeast New Mexico and Culberson, Loving, and Reeves counties in West Texas. It currently serves 38 gas producers in the liquids-rich Bone Springs, Wolfcamp, and Avalon shale plays.
This is Nuevo Midstream's second major expansion in the Delaware Basin, it said, since it launched in April 2011. Phase 2 expansion is supported by additional customer dedications of acreage and production in the Avalon shale trend.
When the expansion is complete, Nuevo Midstream will have 110 MMcfd of processing capacity and 625 gpm of treating capacity at Ramsey along with more than 180 miles of high and low-pressure pipeline and residue connections to interstate and intrastate markets.
The company said that drilling projections from “numerous existing and prospective customers” are to support further system extensions and capacity upgrades.
Nuevo recently completed its Phase 1 expansion, which included recommissioning a 10-MMcfd refrigerated Joule-Thomson processing plant and fractionator and installing 150 gpm of amine treating at the Ramsey plant, as well as adding 13 miles of 8-in. pipeline to the Ramsey gathering system with an interconnect to the Enterprise Products pipeline 9 miles south of the Ramsey plant.
Jay Lendrum, Nuevo Midstream's president and CEO, said "Based on the level of current and planned drilling activity in the area, it is very conceivable that by the time our Phase 2 expansion is operational, we will be in the advanced planning stages of a Phase 3 expansion.
“Our goal is to offer as much as 250 MMcfd of total processing capacity through the Ramsey system," he said.