An expansion program under way since 1987 by Western Gas Processors Ltd., Denver, will culminate this month when the company completes the $36 million purchase of Amoco Production Co.'s Edgewood, Tex., sour gas treating plant.
As part of the package, Western will buy Amoco's Jurassic Smackover crude oil and condensate production in the area. Production last year was about 2,000 b/d.
The Edgewood plant, about 100 miles east of Dallas, is rated at 70 MMcfd processing capacity and 350 tons/day of sulfur production. It currently processes about 50 MMcfd and produces 200 tons/day.
EXPANSION PROGRAM
The Edgewood plant purchase is the latest in a series of expansion moves since Western's first public offering in 1987.
At that time, Western set out to spend $1 00 million during a 5 year period. At the end of 3 years, however, it had spent about $175 million, including commitment of funds to buy Amoco's Edgewood assets.
In 1988, Western built the 15 MMcfd Four Corners gas processing plant in Utah and the 45 MMcfd Lincoln Road plant in Southwest Wyoming.
In 1989, Western bought El Paso Natural Gas Co.'s Midkiff plant near Midland, Tex. And by the fall 1990, it had completed shutting down Midkiff's ambient lean oil plant and installing a more efficient cryogenic plant to process 70 MMcfd (see story, p. 41).
Also since 1989, Western has bought the Giddings gathering system from Parker Gas Cos. Inc. in the Cretaceous Austin chalk area of South Texas. It also bought treating plants in Texas, New Mexico, and Louisiana from Parker.
Further, it bought 50% interests in the pipeline junction in West Texas known as the Waha header (OGJ, Aug. 6, 1990, p. 41) and in the Katy storage project. That project eventually will connect to more than a dozen pipelines and provide 20 bcf of storage.
In a project now in the permitting phase, Western will process gas produced by Shell Western E&P Inc. and Conoco Inc. in the state of the art Shelby sour gas gathering and processing plant in Michigan. The plant will process 20 MMcfd of gas and produce 20 tons/day of sulfur.
1991 PLANS
In several presentations to industry groups and members of the investment community, Bill Sanderson, Western president and chief operating officer, has said Western will gather and process more than 300 MMcfd in 1991. In addition, it will treat more than 200 MMcfd.
Western this year will market about 300-400 MMcfd of gas and produce and market about 750 million gal/day of natural gas liquids. And the company will produce some 400 tons/day of sulfur, mostly from the Edgewood plant but also from the Four Corners and North Dakota plants.
Western currently operates 17 gas gathering and processing facilities, 12 treating plants, and 4,000 miles of gathering lines connected to more than 5,000 wells.
Western holds about 750 bcf under long term purchase contracts with gas producers.
Western started field operations in Colorado in 1977 but now retains only its headquarters in Denver. Early activities focused on Wyoming's Powder River basin and North Dakota's Williston basin.
After restructuring later this year, Western Gas Processors Ltd. will become Western Gas Resources Inc. with publicly held stock representing about a 26% interest in the corporation. The remainder will continue to be held by Western founders.
Copyright 1991 Oil & Gas Journal. All Rights Reserved.
