Robert Brelsford
Downstream Technology Editor
Williams Partners LP and Crestwood Equity Partners LP are proceeding with a major expansion of the Jackalope gas gathering system (JGGS) and associated Bucking Horse gas processing plant in the Powder River basin Niobrara Shale play designed to increase processing capacity to 345 MMcfd by yearend 2019 to meet growing customer demand in the underserved growth basin.
As part of the expansion, current capacity of the Bucking Horse plant in Converse County, Wyo., will increase to 145 MMcfd from 120 MMcfd by the end of this year’s fourth quarter, the companies said.
The expansion also includes plans to add a second plant on the current Bucking Horse footprint by yearend 2019 that will add another 200 MMcfd to JGGS at the existing competitive fee-rate structure.
Owned through a 50-50 joint venture of Williams Partners and Crestwood, the JGGS—which includes the Bucking Horse gas plant—provides gathering and processing services under a long-term, fee-based agreement with Chesapeake Energy Corp. supported by a 358,000-acre area of dedication (gross) from Chesapeake.
While Chesapeake currently operates five rigs in the Powder River basin, as a result of the recent discovery of multiple productive oil-saturated formations, the basin is experiencing a resurgence in activity as producers increase testing and development activities, the JV said.
Currently, there are 19 rigs operating in the Powder River basin targeting primarily the Turner, Frontier, Mowry, Sussex and Niobrara formations, which has resulted in an increasing need for wellhead services and midstream infrastructure in the area.
Based on increasing productivity of the Turner and Niobrara formations and the current level of rig activity within the JV’s dedicated acreage, Williams Partners said it expects volumes to approach full capacity of the expanded JGGS by 2021.
“Our gathering and processing volumes for the JGGS have more than doubled since the start of 2017; increasing the output of this system better positions us to meet the upstream development needs of the Niobrara, which enables us to enhance the midstream services we provide to Chesapeake, increasing our ability to meet the growing demands of our customer,” said Walter Bennett, senior vice-president, Williams’ West operating area.
Alongside expanding services for Chesapeake, expansions of the Powder River basin processing and gathering system will position the JV to support the exponential volume growth forecasted in the basin, including that by other producers in the region, according to Heath Deneke, Crestwood’s executive vice-president and chief operating officer.
Williams Partners is slated to become a wholly owned subsidiary of Williams Cos. Inc. in the fall subject to standard closing conditions and shareholder approval (OGJ Online, May 18, 2018).
