DCP Midstream enters DJ basin gas processing agreement

DCP Midstream LP, a Denver-based 50-50 joint venture of Phillips 66 and Enbridge Inc., has signed a deal with Western Midstream Partners LP to expand natural gas processing capacity in the DJ basin via a long-term offload agreement.

DCP Midstream LP, a Denver-based 50-50 joint venture of Phillips 66 and Enbridge Inc., has signed a deal with Western Midstream Partners LP to expand natural gas processing capacity in the DJ basin via a long-term offload agreement.

The agreement will provide DCP with as much as 225 MMcfd of incremental processing capacity at Western’s DJ basin gas processing complex, which includes the Latham II plant currently under construction, DCP said.

The complex will be well-integrated, with NGL takeaway via DCP’s DJ Southern Hills extension, as well as the Front Range pipeline, and residue gas takeaway via the Cheyenne Connector, according to DCP.

This project will increase DCP’s total gas processing and bypass capacity in the DJ basin to about 1.5 bcfd.

With permits and land already secured, DCP preserves the optionality to build future capacity via the Bighorn facility, a DJ basin gas processing complex with a capacity of as much as 1 bcfd that will be placed into service in phases beginning in second-quarter 2020.

In its 2018 annual report to investors, Western said it was currently building the Latham I and II cryogenic processing trains—each with a capacity of 200 MMcfd—at its new processing plant in Weld County, Colo.

Once completed, the Latham Trains I and II will boost overall processing capacity of the DJ basin complex to 1.14 bcfd.

Latham Trains I and II are both scheduled for start-up during second-half 2019, Western said in its second-quarter earnings report.

Contact Robert Brelsford at rbrelsford@endeavorb2b.com.

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