US partnership buys UK gas plant; expansion nears start-up

North Sea Midstream Partners, recently formed by ArcLight Capital Partners LLC, Boston, has purchased Teesside Gas Processing Plant Ltd. from a consortium of Deutsche Bank, private US equity investor MatlinPatterson, and Carval, a division of the Cargill Group.

TGPP operates a 450-MMscfd gas plant at Seal Sands on Teesside, UK, capable of high levels of NGL extraction, the company said. The Teesside plant processes gas produced in the central North Sea and sent via the 250-mile, 36-in. Central Area Transmission System (CATS) pipeline.

In this year’s first half, the plant will start up a second processing train that will add 225 MMscfd of capacity initially dedicated to the RWE-operated Breagh project in the Southern Gas basin (OGJ Online, Mar. 23, 2011).

Ownership, capacity changes

TGPP Chief Executive Officer Andy Heppel told OGJ the plant was originally developed by a joint venture of Enron Corp. and ICI.

The 400-MMscfd Train 1 began operating in 1993, processing gas from newly developed Everest and Lomond gas condensate fields in the central North Sea. Train 1 was the first to process gas at Teesside delivered by the CATS pipeline.

Teesside Power Ltd. purchased gas from Everest and Lomond fields as fuel for a newly built 1,875-Mw gas-fired power station that also was a joint venture of Enron, ICI, and several regional electricity companies (OGJ, Aug. 30, 1993, p. 47).

Later, said Heppel, Enron’s purchase of gas from J-Block fields prompted construction of the 400-MMcfd Train 2, which exported residue gas into UK’s National Transmission System (NTS). Train 2 began operating in 1996 (OGJ, Jan. 29, 1996, p. 87).

In 2001, Enron Corp. filed for bankruptcy protection, and TGPP was owned by several Enron creditors 2001-05. In 2002, px Ltd. formed to operate the gas plant.

In 2005-06, said Heppel, the consortium including Deutsche Bank and MatlinPatterson acquired TGPP. In 2008, Carval joined the ownership.

In 2008, when the Everest and Lomond gas contract expired, Train 1 was shut down. In 2010, TGPP secured a processing and operational services agreement from RWE as the operator of recently appraised Breagh gas field in Quad 42 of the northwestern part of the Southern Gas basin (OGJ Online, Aug. 9, 2010).

This agreement led to the addition of new slugcatchers, monoethyl glycol handling, condensate stabilization on the idled Train I, as well as modification to process lean gas from Breagh. Those modifications are to be completed shortly, said Heppel, with first gas expected from Breagh before midyear.

Following modification, Train 1 will have a capacity of 225 MMscfd of gas delivered from Breagh field via a recently constructed 68-mile, 20-in. pipeline.

Last year, a debottleneck project on Train 2 increased its capacity to 450 MMscfd, yielding an overall plant capacity later this year of 675 MMscfd.

Affiliates of ArcLight in partnership with senior management of TGPP formed NSMP with Mike Wagstaff, previously chief executive officer of Venture Production PLC.

Contact Warren R. True at warrant@ogjonline.com.

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