Since days when shale oil and gas technologies were discovered, the U.S. energy industry has been evolving more rapidly than ever before. Many changes are amazing especially when you put them on an industry map. At Rextag not only do we keep you aware of major projects such as pipelines or LNG terminals placed in service. Even less significant news are still important to us, be it new wells drilled or processing plants put to regular maintenance.
Daily improvements often come unnoticed but you can still follow these together with us. Our main input is to “clip it” to the related map: map of crude oil refineries or that of natural gas compressor stations. Where do you get and follow your important industry news? Maybe you are subscribed to your favorite social media feeds or industry journals. Whatever your choice is, you are looking for the story. What happened? Who made it happen? WHY does this matter? (Remember, it is all about ‘What’s in It For Me’ (WIIFM) principle).
How Rextag blog helps? Here we are concerned with looking at things both CLOSELY and FROM A DISTANCE.
"Looking closely" means reflecting where exactly the object is located.
"From a distance" means helping you see a broader picture.
New power plant added in North-East? See exactly what kind of transmission lines approach it and where do they go. Are there other power plants around? GIS data do not come as a mere dot on a map. We collect so many additional data attributes: operator and owner records, physical parameters and production data. Sometimes you will be lucky to grab some specific area maps we share on our blog. Often, there is data behind it as well. Who are top midstream operators in Permian this year? What mileage falls to the share or Kinder Morgan in the San-Juan basin? Do you know? Do you want to know?
All right, then let us see WHERE things happen. Read this blog, capture the energy infrastructure mapped and stay aware with Rextag data!
The Haynesville oil and gas basin and its importance
Matador Expands In Delaware; Purchases Acreage from Advance Energy at $1.6 Billion
On January 24, Matador spread the word that it will add oil- and gas-producing assets in Lea County, N.M., and Ward County, Texas, and some midstream infrastructure. Most of the acreage is strategically situated in Matador’s Ranger asset area in Lea County. The bolt-on includes about 18,500 net acres, 99% held by production, in the core of northern Delaware. The deal would also extend Matador’s inventory by 406 gross (203 net) drillable horizontal locations with prospective targets in the Wolfcamp, Bone Spring, and Avalon formations.
BP Has Acquired Archaea Energy for $4.1 Billion Developing Its bioenergy business
BP acquired renewable natural gas (RNG) provider Archaea Energy Inc. for $4.1 billion on December 28, marking a milestone in the growth of BP’s strategic bioenergy business. The acquisition, announced in October, was finalized following BP’s completion of regulatory requirements and Archaea obtaining shareholder approval.
Chesapeake Sells Its Brazos Valley Assets to Be Sold for $1.43 Billion to WildFire Energy
Talos Energy Plans to Close the EnVen Acquisition Soon: Stockholders to vote on $1.1B Deal on February 8
Talos Energy Inc. is closing its $1.1 billion purchase of private operator EnVen Energy. A special meeting for Talos’ stockholders to vote on the deal and other matters is set on February 8, according to a prospectus filed on January 11 with the Securities and Exchange Commission. Shareholders are being asked to approve the EnVen merger, which as the company considered in September would raise its Gulf of Mexico production up to 40%. According to a January 11 press release, Talos asserted that it anticipates closing the transaction soon after the meeting. Talos Energy Inc. supposes that adding EnVen would double its operated deepwater facility footprint, extending key infrastructure in existing Talos operating areas. More than 80% of the combined assets will be deepwater, with the company operating more than 75% of the acreage it holds interests in. Talos is one of the largest independent operators in the U.S. Gulf of Mexico, with production operations, prospects, leases, and seismic databases spanning the basin in both Deep Water and Shallow Water. The company aims to actively grow through a balanced focus on asset optimization, development, and exploration while also seeking to add to its portfolio through acquisitions and business development.
Grand Prix Pipeline Will Be Completely Owned by Targa: To Buy Remaining Stake For $1.05 Billion
On January 3, Targa Resources Corp asserted that it is purchasing the remaining stake for $1.05 billion in cash from BlackstoneInc's energy unit in its Grand Prix NGL Pipeline that it does not already own. Targa, which is going to acquire a 25% stake from Blackstone Energy Partners, purchased 75% interest in the pipeline last year when it repurchased interests in its development company joint ventures from investment firm Stonepeak Partners LP for almost $925 million. The Stonepeak agreement also included 100% interest in its Train 6 fractionator in Mont Belvieu, Texas, and a 25% equity interest in the Gulf Coast Express Pipeline. Grand Prix has the capacity to transfer up to 1 MMbbl/d of NGL to the NGL market hub at Mont Belvieu. The same day Targa maintained the price of the Blackstone Energy Partners agreement, which is anticipated closing in the first quarter of 2023, representing roughly 8.75 times Grand Prix's valued 2023 adjusted EBITDA multiple.
Haynesville's Top 2022 Players That Made It Happen
After reaching record-high production in 2021, the Haynesville Shale seemed to have a quiet 2022, with a smattering of deal activity and attention seemingly focused more on LNG exports than production. Meanwhile, the indications are that the third-largest producing gas shale in the U.S. is growing up for a robust 2023 if commodity prices stand still. Top basin performers Chesapeake Energy, Southwestern Energy, Comstock Resources, Aethon Energy, and Rockcliff Energy II produced a combined total of 1.53 MMboe/d, 83 bbl/d of oil, and 9.2 Bcf/d of gas in the first half of 2022.
$1.55 Billion Deal, Diamond Energy Acquires Lario Permian
On November 16 Diamondback Energy Inc. decided to expand in the Midland portion of the Permian Basin with the acquisition of Lario Permian LLC in a $1.55 billion cash-and-stock transaction. The Permian operator announced another billion-dollar agreement to purchase FireBird Energy LLC, a private Midland Basin operator. In total, Diamondback is paying almost $3.3 billion to extend in the Midland Basin. When combined with the pending FireBird acquisition, Diamondback is increasing its Midland Basin footprint by roughly 83,000 net acres, is adding 500 high-quality drilling opportunities that compete for capital with the current development plan and is raising the 2023 production profile by almost 37,000 bbl/d of oil (50,000 boe/d).
Cardinal Acquires Natural Gas Business in Prolific Delaware Basin to Expand
On November 2, Cardinal Midstream Partners, an independent Dallas-based midstream energy company, concluded definitive agreements with Medallion Midstream Services to purchase Medallion’s natural gas gathering and processing business in the Delaware Basin in West Texas. The transaction is subject to customary closing conditions and is expected to close in early 2023.
Summit Midstream to Acquire Assets in DJ Basin for $305 Million
Recent acquisitions totaling $305 million in cash bring Summit Midstream the opportunity to build up its Denver-Julesburg basin assets. Its subsidiary, Summit Midstream Holdings, concluded a deal to purchase Outrigger DJ Midstream from Outrigger Energy II and Sterling Energy Investments, Grasslands Energy Marketing, and Centennial Water Pipelines from Sterling Investment Holdings. Weld County-based Outrigger’s assets in Colorado are significant as they include a 60 MMcfd cryogenic natural gas processing plant, almost 70 miles of low-pressure natural gas gathering lines, 90 miles of high-pressure natural gas gathering lines, 12,800 horsepower of field and plant compression, and roughly 30 miles of crude oil gathering pipelines. The gathering agreements for Outrigger DJ system are comprised of long-term, fee-based contracts with a weighted average term of over 10 years. Volume throughput on the Outrigger DJ system is underpinned by acreage dedications, with a valued 310,000 leased acres from its key customers, including Mallard Exploration and other producers in the region. Moreover, the Sterling DJ assets, in Weld, Morgan, and Logan Counties, Colorado, and Cheyenne County, Nebraska, have three cryogenic processing plants with a nameplate capacity of 100 MMcfd, some 450 miles of natural gas gathering lines, 8,500 horsepower of field compression, freshwater rights, and 40 miles of subsurface freshwater delivery infrastructure.
Continental Resources Becomes Private, Harold Hamm Purchases it for $4.3 Billion
Continental ResourcesInc. agreed to be purchased by its founder, Harold G. Hamm, in a $4.3 billion cash deal that would take the U.S. shale giant private. On October 17 Continental, based in Oklahoma City, concluded an agreement to be acquired by Omega AcquisitionInc., an entity owned by Hamm, for $74.28 per share. The offer price denotes a 15% premium to the closing price on June 13 — the day before Hamm’s family revealed their initial $70 per share proposal. Even with the proposed incremental leverage from the buyout, CLR would be almost 0.6x leveraged in 2023, and expected FCF, even before assuming reduced costs from going private (else dividend), would have the term loan repaid in about 1.5 years. As a private company, Continental should have greater freedom to operate, particularly in areas such as exploration. Being a chairman of Continental Resources, Hamm and his family own 83% of the company’s stock. Based on the shares outstanding as of October 12, the tender offer would be for almost 58 million shares of common stock, according to the Continental release. The tender offer values Continental at roughly $27 billion. The offer price is slightly under Siebert Williams Shank & Co. LLC’s $75 price target and compares to the consensus price target of $72.86 on FactSet and $71.73 on Bloomberg.
Hydro-Québec to acquire Great River Hydro With 13 hydropower generating stations in New England
Vermont Business Magazine HQI US Holding LLC, a wholly-owned subsidiary of Hydro-Québec, concluded the agreement to purchase Great River Hydro, LLC, which possesses 13 hydropower generating stations with a total capacity of 589 megawatts along New England's Connecticut and Deerfield rivers in Vermont, New Hampshire and Massachusetts. The affiliates of Arc Light Capital Partners, LLC is selling Great River Hydro for a price of roughly US $2 billion. The facilities are situated along the Connecticut and Deerfield rivers. Hydro-Québec is the largest single supplier of electricity to Vermont, comparing to the closed Vermont Yankee nuclear power station in Vernon which produces 620 megawatts. Great River Hydro has A 589-MW hydropower fleet, 13 cascading generating stations and 3 storage-only reservoirs along some 310 miles (500 km) of the Connecticut and Deerfield rivers. Moreover, its annually supply has enough energy to power over 213,000 homes in New England. One fifth of the energy generated is subject to long-term supply contracts, guaranteeing revenue stability. Land holdings of almost 30,000 acres (12,140 hectares), allowing for the possibility of various renewable energy projects.
Half of Kinder Morgan’s Stake in Georgia LNG Facility is Sold to Unknown Company
Kinder Morgan Inc. decided to sell half of its 51% interest in an LNG facility in Georgia on September 27 with proceeds allocated by the Houston-based company to pay short-term debt and buy back shares. As it is acknowledged, an undisclosed financial buyer purchases the 25.5% equity interest in Elba Liquefaction Co. LLC (ELC) for approximately $565 million. ELC is a joint venture (JV) established in 2017 to build and own the Elba liquefaction facility situated on #Elba Island in Chatham County, Georgia. After completion, Kinder Morgan and the undisclosed financial buyer will each hold a 25.5% stake in ELC. Meanwhile, Blackstone Credit will continue to hold a 49% interest. The value of the equity interest considers an enterprise value of almost $2.3 billion for ELC, which is about 13 times 2022E EBITDA. The transaction has an economic effective date of July 1. The Elba liquefaction facility has 10 modular liquefaction units for a total capacity of roughly 2.5 million tonnes per year of LNG. Kinder Morgan considers it equivalent to almost 350 MMcf/d of natural gas.
Bison Gas Gathering System Sold: $40M Cash Paid By Summit Midstream to Steel Reef
Steel Reef acquires Summit Midstream’s Bison Gas gathering system in North Dakota for $40 million in cash as part of Houston-based Summit’s plans to streamline its portfolio. According to a release on September 19, with the sale of Bison Midstream, Summit’s focus in the Williston Basin will be on increasing its crude oil and produced water gathering systems mainly situated in Williams and Divide Counties, North Dakota. The Bison agreement follows the sale of Summit’s Lane gathering and processing system in the #PermianBasin to Matador Resources Co. in June for $75 million. The merger of the divestitures creates additional financial flexibility to reinvest in more strategic scale-building opportunities across Summit’s footprint. Summit Midstream is interested in the status of customer development activity in central Williams County and pro forma for the transaction and anticipates over 50 new wells behind our liquids system in 2023. Pro forma for the Bison transaction, Summit will have about $90 million drawn on its $400 million ABL credit facility, resulting in over $300 million of available liquidity, according to Deneke. The company continues to anticipate to trend toward the high end of our 2022 Adjusted EBITDA guidance range of $205 million to $220 million.
Talos Energy Buys EnVen for $1.1 Billion to Expand
Talos Energy Inc. is acquiring EnVen Energy Corp. for $1.1 billion to raise Talos’ Gulf of Mexico production by 40%. The purchase of EnVen, a private operator, increases Talos' operated deepwater facility footprint 2 times, expanding key infrastructure in existing Talos operating areas. Almost 80% of the assets will be deepwater, with Talos operating more than 75% of the acreage it holds interests in. During a conference call on September 22, it was announced that the EnVen purchase “just checks a lot of boxes” in terms of scale, assets, similar strategies, and what Talos is doing from a technology standpoint. EnVen holds 78 MMboe of 2P reserves and 420,000 gross acres in the Gulf of Mexico. The deal also includes about 24,000 boe/d to Talos’ production stream. Consideration for the transaction consists of 43.8 million Talos shares and $212.5 million in cash, plus the assumption of EnVen's net debt upon closing, currently valued to be $50 million at year-end 2022.
$205 Million for Marcellus Assets Divested by Crestwood to Antero
Antero Midstream Corp. bought Marcellus assets of Crestwood Equity Partners LP on September 12 for $205 million in cash, signing another sale of noncore assets by the Houston-based company. Crestwood has strategically enhanced its asset portfolio through a series of A&D transactions for the previous 18 months to create a competitive scale in the Williston, Delaware, and Power River basins. The strategy covered acquisitions of Oasis Midstream Partners, Sendero Midstream, and Crestwood Permian Basin Holdings LLC (CPJV), which was a 50:50 joint venture of Crestwood and First Reserve. The assets to be bought cover 72 miles of dry gas gathering pipelines and nine compressor stations with about 700 MMcf/d of compression capacity. The current throughput on the system is approximately 200 MMcf/d, resulting in important available capacity for increase without major capital investment. The deal includes almost 425 undeveloped drilling locations and 120,000 gross dedicated acres from Antero Resources mainly in Harrison County. The acquisition is also anticipated to raise Antero Midstream’s compression capacity by 20% and gathering pipeline mileage by 15%.
Momentum Midstream Becomes a Leader in Haynesville Due to Latest Acquisitions
Houston-based company Momentum Midstream LLC on September 22 purchased Midcoast Energy LLC’s East Texas business from an affiliate of Arc Light Capital Partners LLC and Align Midstream LLC from Tailwater Capital and claimed that it establishes a leading presence in the Haynesville Shale. New Generation Gas Gathering or NG3 project will collect natural gas produced in the Haynesville Shale for re-delivery to premium Gulf Coast markets, including LNG export. Moreover, the NG3 project includes a carbon capture and sequestration component that will eliminate 100% of the CO₂ and accumulate it underground for a long time, creating a net negative carbon footprint. With the combined assets of Midcoast ETX and Align Midstream, Momentum is currently delivering volumes of more than 2 Bcf/d for a diverse customer base composed of producers, utilities, end-users, and LNG exporters. Momentum’s footprint in the Haynesville includes about 3,000 miles of gathering pipelines, 1.5 Bcf/d of treating capacity, 700 MMcf/d of processing capacity, 200,000 HP of compression, and 820 miles of pipelines transporting gas to the Gulf Coast markets in southeast Texas and the Carthage and Bethel markets in East Texas.
$465 Million for Stronghold Energy; Ring Energy Completes the Acquisition
On August 31 Ring Energy Inc. purchased privately-held Stronghold Energy, adding operations that are mainly situated in Crane County, Texas, in the Permian Basin’s Central Basin Platform. According to a September 1 Ring Energy release, this transaction fully complements the conventional-focused Central Basin Platform and Northwest Shelf asset positions in the Permian Basin. The majority owned by Warburg Pincus LLC, Stronghold’s operations are concentrated on the development of about 37,000 net acres situated mainly in Crane County. In July Ring Energy entered into an agreement to buy Stronghold Energy II Operating LLC and Stronghold Energy II Royalties LP for $200 million in cash at closing and $230 million in Ring equity based on a 20-day volume weighted average price. Consideration also involved a $15 million deferred cash payment due six months after closing and $20 million of existing Stronghold hedge liability increasing the total transaction value to $465 million. Stronghold’s asset base is almost 99% operated, 99% working interest, and 99% HBP. In July, Ring announced the current net production of Stronghold’s asset base was approximately 9,100 boe/d (54% oil, 75% liquids).
$5 Billion Returns for ConocoPhillips’ Shareholders as Prices Grow
Shareholder’s payout target was increased by 50% after the largest U.S. independent oil producer surpassed Wall Street’s earnings estimates on growing energy prices, said Houston-based Conoco Phillips Co. on Aug. 4. Due to Western sanctions on major producer Russia throttling energy supply amid a rebound in demand from pandemic lows, oil and gas #prices have soared. Crude has been trading more than 25% higher since the start of the year and results also benefited from high natural gas prices. Meanwhile, shares were down a fraction, to $91.03, in early trading but are up about 26% year to date. Conoco Phillips stated, that the average price obtained for a barrel of oil and gas accelerated 77% from a year earlier to $88.57. The company acknowledges that it has not hedged any of its oil and gas sales to make the most of higher market prices. The capacity of 1.69 million boe/d was in line with Wall Street estimates, however, the company expected the current quarter’s output would be between 1.71 million and 1.76 million boe/d.
Aera Energy Sold to IKAV Exxon&Shell Divest of CA Crude Producer
California oil joint venture, Aera Energy, of Exxon Mobil Corp. and ShellPlc is being sold to German asset manager IKAV, according to the agreement of Sept. 1. Shell noted that the sale of its 51.8% membership interest in Aera Energy is for a total consideration of about $2 billion in cash with additional contingent payments based on future oil prices, subject to regulatory approval. However, the total transaction value was not disclosed. Being one of California’s largest oil and gas producers, Aera Energy accounts for nearly 25% of the state’s production. The sale by Exxon Mobil and Shell ends a 25-year-long partnership in California, meanwhile, it persists a streak of divestments of mature oil and gas properties by the two supermajors. Aera Energy LLC operates about 13,000 wells in the San Joaquin Valley in California, producing oil and associated gas. In 2021, Aera took out about 95,000 boe/d. Exxon Mobil’s interests in the Aera oil-production operation in California contained a 48.2% share of Aera Energy LLC and a 50% share of Aera Energy Services Co. held by Mobil California Exploration & Producing Co. Moreover, Exxon Mobil affiliates have signed a separate agreement for the sale of an associated loading facility and pipeline system. The sale effectively ends Shell’s upstream position in California. The company reported that the divestiture is valued to result in a post-tax impairment of $300 million to $400 million, subject to adjustments.
Centennial, Colgate Merger Is Completed on Sep.1
The completion of the merger between Centennial Resource Development Inc. and Colgate Energy Partners II LLC happened on Sept. 1, sealing the debut of Permian Resources Corp., which is considered the largest pure-play E&P company in the Delaware Basin. Permian Resources’ idea was to combine two successful E&P companies, creating a better, stronger, and more strategically compelling company. Centennial and Colgate announced an agreement to merge in May, denying rumors that Colgate, a privately held independent Midland-based company, had been seeking an IPO. The merger estimated Colgate at about $3.9 billion and consists of 269.3 million shares of Centennial stock, $525 million of cash, and the assumption of approximately $1.4 billion of Colgate’s outstanding net debt. Permian Resources, being the combined company, has a deep inventory of “high-quality” drilling locations on around 180,000 net acres the companies anticipate will provide more than $1 billion of free cash flow in 2023 at current strip prices, in accordance with the company release on Sept. 1.
Plains All American Expects 10% Increase in the Permian Oilfield Activity
On 3 August the pipeline operator Plains All American LP raised its 2022 profit forecast for the second time this year, as it expects a huge demand on its pipelines transporting U.S. shale oil to the Gulf Coast. The company increased full-year adjusted earnings guidance by $100 million to approximately $2.38 billion, since it anticipates higher crude and natural gas liquids volumes. European buyers have snapped up the U.S. light sweet crude, the largest part of which is delivered in the Permian Basin of West Texas and New Mexico, as they depend on replacing Russian barrels. Average daily crude oil volumes in the second quarter grew 30% on its Permian Basin pipelines with oilfield activity trending about 10% exceeding its initial expectations. Its shares increased 3.6% in after-hours trading on August 3 to $11.19.
The Deal between TC Energy and Mexican Utility is Concluded to Build $4.5 Billion Gas Pipeline
TC Energy Corp. had reached a deal with a Mexican state utility to build a $4.5 billion natural gas pipeline, according to a company release on Aug. 4. The natural gas to Mexico's central and southeast regions will be furnished by the 1.3 bcfd offshore Southeast Gateway Pipeline, the Canadian pipeline operator said. Due to the most serious trade spat with #Mexico over the United States-Mexico-Canada Agreement, Canada and the United States made the deal with Comisión Federalde Electricidad (CFE). TC Energy and CFE in conjunction with the alliance also took the final investment decision (FID) on the 715-km Southeast Gateway. The pipeline will serve southeast Mexico, starting onshore in Tuxpan, Veracruz, then proceeding offshore, making landfall at Coatzacoalcos, Veracruz, and Dos Bocas, Tabasco.
Certified Low Emissions Gas - Williams & PennEnergy Partner Together
Williams said on Aug. 8, that it concluded an agreement to support the selling and transportation of certified, low emissions next-gen natural gas from PennEnergyResources LLC. According to the deal, Williams will construct a marketing portfolio to market the natural gas to utilities, LNG export facilities, and other facilities which can efficiently use clean energy. Moreover, the agreement involves a certification process that verifies best practices are being followed to reduce emissions and produce natural gas in an environmentally responsible manner collaborating with an independent third party. The partnership with PennEnergy is a continuation of Williams' strategy to collect, market, and deliver low-carbon natural gas to the end user from the wellhead. PennEnergy’s 378 production wells in southwest Pennsylvania supply the US with natural gas and they have achieved Platinum status from Project Canary’s TrustWell certification.
Significant Growth of MPLX; Pipeline Throughput Raised by 6%
According to a midstream oil and natural gas company release on August 2, MPLXLP has increased total pipeline throughputs by 6% in the second quarter of 2022 and terminal throughput by 4%, versus year-ago levels. In an earnings statement of MPLX, the total pipeline throughputs were 5.9 million bbl/d, with terminal throughput of 3.1 million bbl/d for the second quarter. The company reported a net income of $875 million and adjusted earnings of $1.457 million in the second quarter, both higher than in the same period of 2021. Gathered volumes grew up by 11% from year-ago levels to an average of 5.6 Bcf/d. In the Marcellusregion, gathered volumes fell 1% compared to year-ago levels to an average of 1.3 Bcf/d. MPLX is expanding several projects, including in the Permian Basin where the Whistler pipeline is increasing from 2 Bcf/d to 2.5 Bcf/d, in addition to lateral pipelines into the Midland Basin and Corpus Christi domestic and export markets. Moreover, the construction is also maintained on the 200 MMcf/d Tornado ll processing plant, which MPLX anticipates coming online in the second half of 2022. Additionally, 68,000 bbl/d Smithburg de-ethanizer project in the Marcellus is expected to come online in the third quarter.
Mountain Valley Is to Be Completed by Equitrans in 2023: Shares Rose
According to a company release on August 2, U.S. energy company Equitrans Midstream Corp. anticipates finishing the $6.6 billion Mountain Valley natural gas pipeline from West Virginia to Virginia in the second half of 2023. The company decided to complete this project after the announcement on August 1 that Democratic U.S. Senator Joe Manchin honored a commitment from President Joe Biden, Senate Majority Leader Chuck Schumer, and House of Representatives Speaker Nancy Pelosi to permit the long-delayed Mountain Valley to be finished. Manchin’s agreement and the announcement increased Equitrans shares by over 10% to a three-month high of $8.72 on August 2. At the beginning of Mountain Valley construction in February 2018, Equitrans valued the 303-mile (488-km), 2 Bcf/d project would cost approximately $3.5 billion and enter service by late 2018. Equitrans has said the #pipeline was almost completed for 94% and the company has a 48.1% ownership interest in Mountain Valley and will operate the pipeline. Mountain Valley is owned by units of Equitrans, NextEra Energy Inc., Consolidated Edison Inc., AltaGas Ltd., and RGC Resources Inc.
Magellan Reported Volume Changes on Its LongHorn and BridgeTex Pipelines
According to a July 28 report, Magellan Midstream Partners LP stated that the volumes in the last quarter on the Longhorn and BridgeTex pipelines that carry crude from the Permian Basin to Houston dropped dramatically since shippers likely exported barrels, meanwhile, refined product volumes grew on pandemic demand recovery. Volumes on the 450-mile (724-km) Magellan’s wholly-owned Longhorn crude oil pipeline from West Texas to Houston averaged approximately 200,000 bbl/d in the three months ended June 30 in contrast with 260,000 bbl/d in the same period the year before. A joint venture, the BridgeTex crude pipeline from the Permian to Magellan’s East Houston terminal dropped to 215,000 bbl/d from virtually 315,000 bbl/d in the year-ago period. However, volumes on the most prominent common carrier refined products pipeline system in the U.S. increased 3% partly because of pandemic demand recovery. Income from oil storage plunged as a steeply risen-in-price market made holding barrels less attractive and following contract expirations while operating expenses grew $28 million.
Baker Hughes To Help Driftwood Pipeline Decarbonize Its Lines 200 and 300 Projects
According to a press announcement on June 29, Baker Hughes got a contract to supply electric-powered Integrated Compressor Line (ICL) decarbonization technology and turbomachinery equipment for an upcoming natural gas transmission project by a subsidiary of Tellurian Inc. – Driftwood Pipeline LLC. Driftwood Pipeline decided that the projects of Lines 200 and 300 would be situated in Beauregard and Calcasieu Parishes in southwest Louisiana and it will be the first time when Baker Hughes installs its ICL technology for pipeline compression in North America. Joey Mahmoud, president of Tellurian Pipelines, says the company expects that the project will give upwards of 5.5 Bcf of natural gas every day, with virtually no emissions. As a part of the agreement, Tellurian makes the initial $240 million pipeline investment as part of the broader Driftwood Pipeline system, which will keep enhanced supply reliability to meet the area’s projected industrial enlargement in a purer, more sustainable way. Baker Hughes has installed over 50 ICL units across the different pipeline and offshore applications, mainly in Europe. The compressors exert a reduced environmental footprint because their hermetically sealed casing prevents emissions from obviating. It is important to mention, that they require minimal downtime as magnetic bearings are resulting in more efficient operations and low maintenance.
Growing Export of US Crude Oil Is Expected to Set Record This Quarter
On 27 June, the analysts at Kpler spread the word that the exports of crude oil from the U.S. Gulf Coast could break a record 3.3 MMbbl/d this quarter as Europe has regard to U.S. crude which can outweigh sanctioned Russian oil. Due to Washington's decision to release 180 MMbbl of oil from the nation's Strategic Petroleum Reserve, U.S. exports have increased in the last three months, as it has flooded the domestic market. Exports to Europe are anticipated averaging approximately 1.4 MMbbl/d this quarter, about 30% higher than the year-ago quarter, meanwhile, export to Asia is set to decrease to less than 1 MMbbl/d. Despite that the U.S. has lost about 1 MMbbl/d of refining capacity since 2020, it also boosted exports thanks to the government’s intervention to back crude supplies which has had consequences in growth in exports. Throughput via the Port of Corpus Christi has grown by more than 150,000 bbl/d and has become 1.86 MMbbl/d. Nevertheless, Port of Houston exports also have been increasing since the third quarter of last year, they remain below pre-pandemic levels.
Earthstone Expands Due to Acquisition of Titus’ Delaware
Earthstone Energy Inc., based in Texas, announced the transaction on June 28: the acquisition of Titus Oil&Gas which will raise production in the Delaware Basin by 26%. The $627 million acquisition fills the Permian Basin in Eddy and Lea counties, N.M. with 86 net locations on 7,900 net acres of leasehold, while it is not clear how much of the leasehold might be on federal acreage It is Earthstone’s seventh acquisition since 2021, a span that includes the closing of approximately $1.89 billion in acquisitions in the Permian Basin. The purchase of Titus Oil & Gas Production LLC and Titus Oil & Gas Production II LLC, privately held companies backed by NGP Energy Capital Management LLC, is estimated at $575 million in cash and it is the equivalent of $52 million in stock (3.9 million shares of its Class A common stock based on the June 24 closing price). Titus shared that its net production in June was 31,800 boe/d. The company had reserves of approximately 28.9 MMboe. Earthstone is sure its net production will increase, at the midpoint, by 20,500 boe/d (65% oil) in the fourth quarter.
Potential Deal for $5 Billion: Tug Hill and Quantum Energy Seek Sale
Undisclosed industry sources said that THQ Appalachia I LLC (Tug Hill and Quantum Energy) is seeking a sale of the U.S. natural gas producer for more than $5 billion, including debt. Mainly operating in the Marshall and Wetzel counties in West Virginia, THQ Appalachia has net production of around 760 MMcf/d. Despite volatility in commodity markets which has made the valuation of energy producers tougher, THQ Appalachia is anticipating more than $5 billion due to the worth of its existing production and the possible value of its undeveloped acreage, the sources said on June 17. Additionally to purchasing THQ Appalachia, possible bidders in the sale process also have the opportunity to buy XcL Midstream, the pipeline firm that moves the company’s gas to market and has the same CEO as in Tug Hill. If the same buyer chooses to purchase XcL, the deal consideration will increase further. However, the anonymous sources admitted that the sale depends on the market conditions and is not guaranteed since Tug Hill and Quantum could ultimately decide to retain some or all of THQ Appalachia and XcL’s assets. Tug Hill and Quantum refused to comment on these statements and XcL did not respond to a comment request.
DCP Midstream Expands Permian Basin Footprint with $160 Million Bolt-on Acquisition
A bolt-on acquisition of Woodland Midstream gathering and processing assets in the Permian Basin by DCP Midstream LP is under consideration and estimated at $160 million. According to a definitive agreement announced on June 14, DCP Midstream will get the James Lake System from Woodland Midstream II, a portfolio company of EIV Capital. DCP anticipates funding the bolt-on acquisition using cash on hand and borrowings under the company’s existing bank facilities. Since the James Lake System is situated within three miles of DCP’s Goldsmith processing facility in the Permian Basin, it provides the opportunity to maintain significant synergies and reduce the acquisition multiple over time. The System includes about 230 miles of gathering pipe and a 120 MMcf/d cryogenic processing facility, increasing DCP’s capacity and serving significant synergies with the company’s Goldsmith processing facility in Ector County, Texas. The James Lake System attends producers within the Permian’s Central Basin Platform in Ector, Andrews, and Winkler counties, Texas. It is expected that DCP also secures about 250,000 dedicated acres and the transaction itself is expected to be completed in the third quarter of the year. To ensure the fulfillment of this transaction: Holland & Hart LLP provides legal counsel to DCP; Intrepid Partners, LLC is a financial adviser and McDermott Will & Emery LLP is a legal advisor to Woodland Midstream II.
Cheniere’s LNG Is on the Next Level Due to Corpus Christi Expansion FID
According to CheniereEnergy’s board of directors announcement on June 22, the company declared the further expansion of its CorpusChristi, Texas. Moreover, the LNG plant could come sooner than expected due to the announcement of a final investments decision (FID) related to Stage 3 Liquefaction Project work at the export facility. It will ensure the capacity to ship 10-plus million tonnes per annum (mtpa) from 7 midscale trains. Furthermore, TudorPickering, Holt & Co. (#TPH) declared on June 23, that the possible ultimate capacity of the facility could be in the 11-12 mtpa range given 10.7 mtpa of long-term contracts have been signed with companies such as CPC, PGNiG, Sinochem, Foran, ENGIE, Apache, EOG and ARX CN. Additionally, Cheniere announced two sale and purchase agreements (SPAs) with #ChevronCorp.: Firstly, Chevron will obtain 1 mtpa of LNG from Sabine Pass Liquefaction LLC with deliveries considered to start in 2026. Deliveries will reach full capacity in 2027 and expire in mid-2042. Secondly, Chevron will obtain 1 mtpa of LNG from Cheniere Marketing LLC with deliveries considered to start in 2027 and continue for about 15 years. The purchase price for the LNG under both SPAs will be indexed to the Henry Hub price, plus a fixed liquefaction fee as Cheniere claimed. Since the expansion will have been completed, Cheniere’s aggregate nominal production capacity will be increased to more than 55 mtpa by the end of 2025 compared to 45 mtpa now. It will become a part of the industry-wide decarbonization movement away from coal and oil as this allows Cheniere to provide the global market with additional low-carbon fuels. First exports from the facility are anticipated in 2025.
$7 Billion Merger of Colgate and Centennial, the 2 Largest Permian Operators
Despite the circulating rumors concerning Colgate’s attempt to launch an IPO, on May 19 the company decided to combine with Centennial Resource Development Inc. This merger of equals is estimated at $7 billion and will found the biggest pure-play E&P company in the Delaware Basin of the Permian. The transformative combination essentially enlarges companies’ potential and hastens the growth across all financial and operating metrics. According to Centennial CEO Sean Smith, the combined company is anticipated to furnish shareholders with quickened capital return program due to a fixed dividend coupled with a share repurchase plan. Due to a recent report, the merger would increase production 7%, to 145,000 boe/d by the fourth quarter would further ratchet up next year. By third-quarter 2023, the company predicted 160,000 boe/d based on a drilling program of 140 wells per year. Colgate Energy was reported to be getting an IPO last December that sources said would value the company at approximately $4 billion. The combined company will have over 15-years of drilling inventory, assuming its current drilling pace, the companies will produce over $1 billion of free cash flow in 2023 at current strip prices.
Get Your Energy Data Research Done
Below is our webinar review of what Rextag is. Being a division of Hart Energy, Rextag is aimed at providing data services. You should be already familiar with Hart Energy conferences and publications about oil and gas basins, etc. What we want to show are the use cases of our clients, what our product is, how it is used, what data services are there, and some of the key scenarios, that our customers shared with us. We licence the data by datasets (the ones you see on the left pane within the Energy DataLink application. Our customers can licence access to the data based on the folders (or modules) here. e.g. Upstream oil and gas, and other modules below. So if you are an operator who works on Upstream or Midstream assets or you are interested in them you would licence both the Upstream dataset and respective midstream datasets. They are delivered to the customers in different ways. If you are familiar with GIS databases or SQL you can consume the data in those forms or set up web services connection to your cloud database. If you do not need to save the raw data on your computer, you can access our web application that you now see in the video. If you are a software developer or a product developer within your organisation you can use this information via API access to embed it inside your application. Also, we licence the data for an unlimited number of users for this application.
Energy Transfer LP Races to Carry Permian Basin Gas to Gulf Coast Hubs
The ever-increasing demand for natural gas exports from the Gulf Coast started a race to further develop Permian Basin. Various companies, including Kinder Morgan and MPLX, are among those looking at building new pipelines in the region due to the demand spike. But Energy Transfer seems to edge past them into the lead since its project strikes as the most economical option for the basin outside of capacity expansions on existing pipelines and could essentially add 1.5-2 Bcf/d of transport capacity with just 260 miles of new pipe.
Evolution Acquires Non-operated Wyoming Natural Gas Interests
Evolution Petroleum just spend a fortune on Jonah’s Field right after acquiring Hamilton Dome Field in Wyoming. The price of the transaction is $29.4 million. The Houston-based company aims to diversify into natural gas assets, providing access to the western markets through the Opal market hub, with the optionality to flow to the east. That transaction took effect on February 1. We anticipate closing on or about April 1.
Look At The Future Of American And Appalachian Gas Production
The crux of the matter is rather simple: productivity gains of local energy operators have been stable not only because they are drilling better acreage, but also because players finally realized capital efficiency gains. And even if some new obstacles impede Appalachia's growth at the same rate as the Permian or Haynesville, it does not detract from the value of the Marcellus and Utica basins. The Appalachians will still be the top producers at a very competitive pace as long as commercial inventory exists. After all, as long as there is commercial inventory, somebody will have to drill.
Enterprise acquires Navitas Midstream for $3.25 billion in cash
Enterprise decided to go in on the Permian Basin. With the surprise purchase of Navitas Midstream for $3.25 billion in cash, the company gained a foothold in the Midland Basin, as it previously lacked #naturalgas or NGL infrastructure apart from downstream pipelines in the region. Enterprise estimates that distributable cash flow accretion will be in the range of $0.18 to $0.22 per unit in 2023, while simultaneously supporting additional capital returns to their limited partners through distribution growth and buybacks of common units.
Colgate Energy's owners are planning to go public
Colgate Energy is planning to float its shale oil producer in the Permian's Delaware Basin on the stock market. If successful, this IPO would be the first major U.S. oil producer offering since Jagged Peak Energy's IPO in January 2017. Looks like investors’ confidence in the sector is returning as U.S. crude prices hit their highest in seven years late last year S&P energy index delivered roughly twice the return of the S&P 500 in 2021.
BP's South Haynesville Natural Gas Passed MiQ’s Certification with Flying Colours: a Straight-A Student
Rail Permit for New Fortress to Ship LNG Expired, Putting Future Projects at Risk
Uncertainty grows: as New Fortresses permit to ship LNG by rail expires, PHSMA explores temporal pausing of the method to provide more time to study safety-related issues. The news prompts one to wonder whether Fortress will proceed with its Pennsylvanian LNG project, in which it has already sunk about $159 million in development.
No More Gas Flaring: the Permian's Double E Pipeline is brought into service in West Texas
Permian Basins gas infrastructure boom: Summit Midstream puts into service a new pipeline system, aimed at reducing gas flaring in the area. Besides ecological concerns, the project will also transport almost 1,5 billion cubic feet of gas per day — enough to supply 5 million U.S. homes every day. According to Federal Energy Statistics, the project cost a whopping $450 million.
Smart Investments Are The Key To Success: Williams JV Brought Benefits At The End Of The Year
Williams boasts its Q3 results. With a revenue of $2.48 billion, the company beat the analyst estimate of $2.09 billion and also improved upon its own results over the same period in 2020. Mind you, much of this success was attributed to production in Wyoming's Green River Basin's Wamsutter Field and Williams JV with Crowheart.
The Final Stretch: Energy Transfer Pushes For Mariner East Project Ahead Of The Stunning Q3 Results
Energy Transfer's lead in the world's NGL exports booked the company another successive quarter. With a global market share of almost 20%, the company is nigh unstoppable. But will it be enough to, finally, push the Mariner East project over the edge? If everything goes as planned, Mariner East's last segment could be operational by the end of the first half of 2022.
Delays Are Finally Over: Enbridge Reports Strong Third Quarter 2021
Enbridge Inc. finally delivered on several of its long-overdue promises, including the $4 billion Line3 Replacement project. Which consisted of replacing an existing 34-inch pipe with a new 36-inch one for 13 miles in North Dakota, 337 miles in Minnesota, and 14 miles in Wisconsin. Midstream companies, in general, had a stunning Q3. It was the first quarter in two years that no midstream index members cut their dividends.
Expansion Is The Goal: Ironwood II Completes Asset Merger And Assumes Management of Nuevo Midstream Dos’ Eagle Ford Assets
Ironwood Midstream expanded its operations in the Eagle Ford region through its merger with Nuevo Midstream. Thanks to this, Ironwood II has increased its crude oil and natural gas throughput capacities in the famous shale to approximately 400,000 bbl/d and 410 MMcf/d, respectively. With 390 miles of pipelines, the company manages 245,000 acres of dedicated land.
Pivot to the South: LNG Plants Under Development by Sempra Energy in Louisiana and Mexico
Sempra Energy would develop the 4.0-mmtpa Vista Pacifico LNG export facility located next to the company's Terminal for Refined Products in Topolobampo in a bid to provide gas from the Permian basin in Texas and New Mexico to Asian markets. Once marketing begins, Sempra's management expects Vista Pacifico to be oversubscribed.
Expansion for TC Energy in Midwest US to cost $800 million
TC Energy splurged $0.8 billion on the project that targets emissions. Well, sorta. According to the idea, existing lines of the ANR Pipeline Company will be expanded to serve markets in the #Midwestern US and simultaneously updated to reduce discharge by 30,000 metric tons CO2e per year - equivalent to removing almost 7000 cars from the road annually. Remarkable goals. With the current timeline, the project will be fully operational by the end of 2025, thanks to long-term transportation agreements secured by ANR.
13 years is not long enough: Glencore and Cheniere Sign Long-Term LNG Deal
Texas Cheniere and Swiss Glencore had entered into a free-on-board agreement for approximately 0.8 million tonnes of LNG per annum, starting in April 2023 for 13 consecutive years. This SPA demonstrates the commercial momentum Cheniere has been enjoying and marks an important milestone, as the company lays the groundwork for a final investment decision on Corpus Christi Stage 3, which is expected to occur next year.
Ain't Nothing Like a $2 Billion Deal: Oasis Sells Midstream Affiliate to Crestwood
Crestwood & Oasis Midstream merge to create a top Williston #basin player. $1.8 billion deal is expected to close during the Q1 of 2022. The transaction will result in a 21.7% ownership stake for Oasis in Crestwood common units. The remaining ownership of Oasis in Crestwood will also be of benefit to the company since it will create a diversified midstream operator with a strong balance sheet and a bullish outlook after this accretive merger.
The green trend: TC Energy pledges to be carbon-free by 2050
TC Energy, the Canadian gas giant, recently announced its environmental, social, and governance goals, as well as emission reduction strategies. The company aims to become 100% emission-free by 2050 while promising to cut greenhouse gas emissions intensity from its operations by 30% by 2030 as an interim measure.