90% Construction Work on MVP to Be Complete by Year-End 2019

The Mountain Valley Pipeline project team was able to make significant construction progress, despite various legal and regulatory challenges during 2019. In accordance with Mountain Valley Pipeline’s August 2019 voluntary suspension, much of its forward-construction work was already deferred, resulting in a shift of more mainline work into 2020.

“We are pleased with our progress during the past 10 months and, despite the few remaining permitting issues, we remain confident in the regulatory process and look forward to the successful in-service of this important infrastructure project," said Diana Charletta, President and Chief Operating Officer, EQM Midstream Partners, LP, operator of MVP.

Mountain Valley Pipeline’s three compressor stations and three certificated interconnects are now 100% complete. Approximately 80% of the pipeline work is also complete, which includes 264 miles of pipe welded and in place. Also approximately 50% of the right-of-way has been fully restored.

On October 15th, the Federal Energy Regulatory Commission issued a project-wide order halting forward-construction progress in response to the US Fourth Circuit Court of Appeals order granting a stay of MVP's Biological Opinion and Incidental Take Statement issued by the US Fish and Wildlife Service in November 2017.


Calcasieu LNG Project Receives Notice of Schedule for Environmental Review

US Federal Energy Regulatory Commission has issued Notice of Schedule for Environmental Review for the Calcasieu LNG project, Commonwealth LNG announced. The project includes the construction of one liquefied natural gas plant, including six gas liquefaction trains and appurtenant facilities.
“We are very pleased to receive FERC’s Issuance of Notice of Schedule for Environmental Review. It confirms that our project remains on schedule to take FID in Q1 2021 and start commercial operations in Q1 2024,” said Paul Varello, Commonwealth LNG’s President and CEO.

The Calcasieu LNG project is located on the west side of the Calcasieu Ship Channel, near the entrance to the Gulf of Mexico. Each gas liquefaction train will have a liquefaction design capacity of approximately 1.4 million metric tons per annum for a total nominal liquefaction capacity of 8.4 MTPA.

The project consists of six LNG storage tanks each with a capacity of 40,000 cubic meter, one marine loading berth capable of loading LNG carriers up to a capacity of 216,000 cubic meter, and a 3.04-mile long, 30-inch diameter pipeline that will connect the LNG Facility with existing intrastate and interstate pipelines for the purpose of supplying gas to the project.


Natural Gas Transmission Business Acquired from Third Coast Midstream

A definitive agreement to acquire Third Coast Midstream LLC’s natural gas transmission business was announced by Basalt Infrastructure Partners.

The Natural Gas Transmission Business includes 7 regulated natural gas lateral pipelines that are connected to 8 major long-haul pipelines, ensuring reliable gas supply to customers across Louisiana, Alabama, Mississippi, Tennessee and Arkansas.

"We are proud of the accomplishments our team has executed over the last several years in building out this portfolio of high-quality gas transmission assets in the Southeast United States," stated Matt Rowland, Third Coast's President and Chief Executive Officer. “The sale is a further step in Third Coast's strategic repositioning to focus on its core Gulf of Mexico infrastructure platform."

The lateral pipelines stretches approximately 550 miles and have a total capacity of over 1,600 MDth per day. The terms of the transaction are not being disclosed and consummation of the transaction remains subject to customary closing conditions.


$2.25 Billion Assets in Haynesville Shale Basin Acquired by DTE Midstream

DTE Midstream has announced that it will acquire 100% of the assets from Momentum Midstream and Indigo Natural Resources. DTE Midstream has entered into an agreement to acquire a gathering system and gathering pipeline in the Haynesville shale formation of Louisiana.

As per the agreement, the purchase price will be of US$2.25 billion in cash, plus a US$400 million milestone payment upon completion of the gathering pipeline in the second half of 2020. The selling companies are the primary gas producers supplying the system.

"DTE's non-utility operations continue to grow, perform well and fit nicely into our planned utility and non-utility mix," said Jerry Norcia, president and CEO of DTE Energy. "This acquisition is highly accretive, has world-class resources, has excellent access to large markets, and is in the early- to mid-cycle development phase. It checks all of our boxes," Norcia added.

The acquisition assets includes an existing gathering system and a 150 mile gathering pipeline that is under construction and which will be in service in the second half of 2020.


Force Majeure Declared on Keystone Pipeline

TC Energy, formerly known as TransCanada has declared force majeure on the 590,000 barrel per day Keystone oil pipeline. The company confirmed that a snow storm in Manitoba over the weekend disrupted operations.

Three sources said that the storm knocked out power to about 3-4 pump stations in Manitoba, affecting pipeline flows. It is unclear how much of volumes were reduced by TC Energy's declaration of force majeure.

"Due to the recent storm in Manitoba over the weekend, we did declare force majeure as the province declared a state of emergency. We are currently operating at reduced flows," TC Energy spokesman Terry Cunha told Reuters in an email.

The Keystone pipeline system is one of the few vital outlets that carry Canadian crude from northern Alberta to refineries in the U.S. Midwest. Force majeure is a declaration that unforeseeable circumstances prevented a party from fulfilling a contract.


Start-Up of New Crude Oil Gathering System in DJ Basin Announced

ARB Midstream, LLC has announced a key expansion of its fast-growing crude oil gathering and transportation system in the prolific DJ Basin in northeastern Colorado.

DJ South Gathering, LLC, a subsidiary of ARB Midstream is currently constructing the Badger Pipeline. The pipeline is one of three large diameter transmission lines currently being constructed by DJ South Gathering.

The Badger pipeline transports, with a throughput of 90,000 barrels per day production from southwestern Weld County and delivers into 300,000 bbls of dedicated crude oil storage at Platteville, the key crude oil hub within the DJ.

Apart from Badger pipeline, DJ South Gathering system also includes the 220,000 barrels per day Matador pipeline, the 150,000 barrels per day bi-directional Freedom pipeline, Bennet Station, and the Platteville Storage and Distribution network.


Construction of Marten Hills Pipeline System Commenced

Rangeland Midstream Canada has announced that it has started the construction of its Marten Hills Pipeline System. The Pipeline System will extend approximately 52.8 miles and consists of new crude oil and condensate pipelines.

The system starts from the Marten Hills region of north central Alberta and ends at the interconnection with Plains Midstream Canada’s Rainbow Pipeline System in Edmonton, Alberta.

“Rangeland Canada is excited to announce that we have received all of the required permits and regulatory approvals that allow us to begin clearing rights of way in advance of pipeline construction, which is expected to begin later this month,” said Rangeland Canada Vice President of Business Development Briton Speer. “The Marten Hills system will alleviate infrastructure bottlenecks and allow us to provide our customers with flow assurance and the safe, high-quality transportation services they need to access the best markets.”

The Marten Hills system is expected to come into service in the second quarter of 2020. The system is anchored by long-term transportation agreements with three of the region’s largest crude oil producers, who have made a combined minimum volume commitment representing 40% of the system’s capacity.


Permits for Proposed Natural Gas Pipeline Denied by NJ

The permits for the PennEast Pipeline Company’s proposed 120-mile long natural gas pipeline that would start in Pennsylvania and end in New Jersey was rejected by the New Jersey Gov. Phil Murphy’s administration.

The company won the federal approval for the project last year but has suffered some setbacks lately. The Governor tweeted a copy of the Department of Environmental Protection’s permit denial letter to the PennEast Pipeline Company.

The state’s rejection of wetlands and other permits comes after a ruling last month by a federal court that said PennEast couldn’t use eminent domain to acquire 42 properties owned by the state and preserved for open space.

The company is confident that legal issues will be resolved favorably and that the company is committed to the project, PennEast spokeswoman Pat Kornick said.


Sendero Carlsbad Gateway Project Approved by FERC

The construction of the Sendero Carlsbad Gateway natural gas project in the Permian Basin was approved by Federal Energy Regulatory Commission. The project includes a 23 miles of 24 inch diameter pipeline with 400 Mmcf per day capacity between its Carlsbad processing plant and White Water Midstream's Agua Blanca pipeline.

The pipeline will expand upon Sendero's current 70 miles of 8 to 12 inch gathering system. The project will also include a new meter station within the existing Carlsbad Plant in Eddy County, a mainline block valve at milepost 15.0 in Eddy County, and a pig receiver and mainline block valve at milepost 23.3 near a White Water Midstream, LLC meter station in Culberson County.

Gateway will own all of the gas transported on the pipeline and has no plans to provide third-party transportation service. For that reason, FERC approved the company’s request to waive some of the regulatory obligations that are typically required of interstate pipelines that provide open-access service.


Mountain Valley Pipeline Permits Placed on Hold by Appeals Court

The 4th U.S. Circuit Court of Appeals issued hold on two permits from the U.S. Fish and Wildlife Service that needed for construction of the Mountain Valley Pipeline. 

The court was reviewing a lawsuit filed by environmental groups in August. The Sierra Club said in a statement Friday that the suspension effectively means that construction must stop on the 300-mile natural gas project.

The spokeswoman for the pipeline, Natalie Cox told The Roanoke Times that pipeline officials are “disappointed and disagree” with the 4th Circuit’s ruling. The lawsuit alleges that the Fish and Wildlife Service’s approval of the project failed to adequately protect endangered species along the pipeline’s path.

The pipeline would run between northwestern West Virginia and southern Virginia. The pipeline developers has already suspended some construction activities in areas where the work could impact protected bat and fish species after the lawsuit was filed.


Appalachia-To-Texas Ethane Pipeline Expansion Announced

The expansion of Appalachia-to-Texas pipeline, known as ATEX was announced by Enterprise Products Partners in a statement released on Monday morning. The 1,200-mile pipeline moves ethane from the Marcellus Shale and Utica Basin of Pennsylvania, West Virginia and Ohio to Enterprise's natural gas liquids storage complex just east of Houston in Mont Belvieu.

“The success of the open season reflects the demand for additional, reliable ethane takeaway capacity from the Appalachian region of the country,” Enterprise Senior Vice President Michael C. "Tug" Hanley said in a statement. “Our customers value flow assurance and reliability. The expansion of ATEX will facilitate growing production from the Marcellus/Utica Basin and will provide access to attractive markets on the Gulf Coast through Enterprise’s integrated midstream network.”

The decision came after the completion of a 30-day open season for producers to book capacity on the expansion project. The pipeline can currently move 145,000 barrels of ethane per day but the expansion project will boost that to 190,000 barrels per day. 

Estimated construction costs have not been disclosed. Through improvements and modifications to existing infrastructure, the extra capacity will be available by 2022.


Renewed Keystone XL Arguments Will Be Evaluated Again

U.S. District Judge Brian Morris will be deciding on whether to once again block the proposed Keystone XL oil pipeline or agree with U.S. government attorneys who want him to uphold President Donald Trump's permit to cross the U.S.-Canada border.

The judge heard arguments on Wednesday by environmental groups seeking to halt the 1,184-mile pipeline and by government attorneys who say the presidential permit isn't subject to environmental laws.

Morris blocked construction last year after ruling that officials had not fully considered oil spills and other environmental effects. But later in March, Trump signed the new permit, prompting the plaintiffs to accuse the president of trying to get around the judge's previous order.

Native American tribes alleges Trump's approval did not take into consideration the potential damage to cultural sites and a separate lawsuit has been filed by them.


James Lake System acquired by Woodland Midstream II

Woodland Midstream II, LLC announced the acquisition of the James Lake System. James Lake represents a fully integrated sour gas gathering, treating and processing system with approximately 230 miles of pipeline, 110 million cubic feet per day of processing capacity and 35,000 HP of owned compression that serves producers in the Permian’s Central Basin Platform.

“James Lake has been a primary target of ours given its strategic location in the Permian Basin. This transaction represents Woodland’s first operating asset,” said Richard H. Wright, III, Chief Executive Officer. “We are thankful for the opportunity to work alongside our equity partners EIV Capital for a second time as we build a company focused around our customers, shareholders and employees.”

Other plans for Woodland is to invest additional capital into James Lake to accomplish multiple plant optimization and emissions reduction focused projects. Also the company plans to enhance and expand James Lake’s condensate and liquids handling business as well.

“The acquisition of the James Lake System is an important step in realizing our vision to build a Permian-focused midstream company that brings customer service back to the focal point,” said Darin Aucoin, Chief Commercial Officer.


Goodnight Midstream Receives $500 Million for Expansion

Dallas-based private equity firm Tailwater Capital has committed more than $500 million for Goodnight Midstream to expand its oil field water operations. Goodnight Midstream is active in Bakken Shale of North Dakota, the Permian Basin of West Texas and Eagle Ford Shale of South Texas on moving produced water or saltwater and oilfield wastewater. 

"With this capital flexibility, we will continue to meet the increasing demand from our customers for scalable produced water infrastructure solutions and remain focused on providing safe, reliable and environmentally sustainable produced water logistics services to our customers," Goodnight Midstream Co-Founder and CEO Patrick Walker said in a statement. 

"With favorable market dynamics driving further investment in the produced water midstream sector, and the company's numerous customer contract wins, our team at Tailwater has strong conviction in Goodnight's industry leadership and continued success," Tailwater Capital Co-Founder and Managing Partners Edward Herring said in a statement. 

Dozens of saltwater disposal wells and hundreds of miles of produced water pipelines are operated by Goodnight Midstream in the Bakken Shale of North Dakota, the Permian Basin of West Texas and Eagle Ford Shale of South Texas. Two pipeline systems were put into service recently in the Permian Basin that will move 600,000 barrels of wastewater from oil and natural gas wells to disposal sites.


Midland to Echo System Expansion Announced

Expansion of the Midland to ECHO crude oil pipeline system was announced by Enterprise Products Partners L.P. The company will build a pipeline that connects the partnership’s 6 million bbl Midland, Texas storage facility to its ECHO Terminal through its Eagle Ford system in South Texas.

The company said it has long-term agreements that will support the expansion. The pipeline will have an initial capacity of 450,000 barrels per day and can be expanded up to 540,000 barrels per day.

The expansion will allow Enterprise to optimize its entire Midland to ECHO system, which will be comprised of four pipelines, by moving barrels in the most cost-efficient manner. It will also enable the partnership to maximize the operational flexibility of the Seminole Red pipeline in either crude oil or natural gas liquid service based on the needs of the respective markets.

This expansion project will also allow customers with crude oil and condensate production in both the Permian Basin and the Eagle Ford to maximize the value of their contracted pipeline capacity.


Cushing Connect Joint Venture Formation Announced

The formation of a 50/50 joint venture for Cushing Connect Pipeline & Terminal LLC was announced by Holly Energy Partners, L.P. and Plains All American Pipeline.

Development and construction of a new 160,000 barrels per day crude oil pipeline will be done by the joint venture. The pipeline will connect the Cushing, Oklahoma crude oil hub to the Tulsa, Oklahoma refining complex and is expected to be in service during the first quarter of 2021.

The joint venture will also own and operate the 1.5 million bbls of crude oil storage terminal in Cushing, Oklahoma which is expected to be in service during the second quarter of 2020.

“The new Joint Venture will provide growth to HEP by insourcing logistics spend and provide the capability to supply 100% of HFC’s Tulsa Refinery crude throughput,” commented George Damiris, Chief Executive Officer of the general partner of Holly Energy Partners. “Our partnership with Plains generates HEP growth while providing HFC long-term control of a strategic asset.”

“This win-win Joint Venture aligns with our strategy of optimising existing assets to provide value-chain solutions for long-term industry partners in a capital efficient manner,” stated Jeremy Goebel, Executive Vice President – Commercial, Plains All American. “This investment expands our relationship with a key operational hub service customer and provides additional long-term alignment on movements to the Tulsa refinery.”

An affiliate of Holly Energy Partners will be given the contract to manage the construction and operation of the pipeline. Also an affiliate of Plains will manage the operation of the crude oil storage terminal in Cushing, Oklahoma.


$355 Million Joint Acquisition of Reliance Gathering Announced

Rattler Midstream LP and Oryx Midstream have announced that their newly-formed joint venture entity has entered into a definitive purchase and sale agreement to acquire Reliance Gathering, LLC for US$355 million in cash. The transaction is anticipated to close in the fourth quarter of 2019, subject to certain closing conditions.

The companies will acquire oil gathering system that includes over 230 miles of gathering and regional transportation pipelines and approximately 200,000 barrels per day of crude oil storage in Midland, Martin, Andrews, and Ector counties.

The ownership will be split 60/40 between Rattler and Oryx. Oryx will operate the system following closing.

Other acquisitions include:

  • Current system throughput of over 110,000 barrels per day from six substantial oil and gas operators, including Diamondback and other top-tier operators.

  • Over 160,000 gross acres in Northern Midland Basin dedicated under long-term, fixed-fee agreements, some of which benefit from minimum volume commitments.

  • Top three producers contributing over 85% of 2019 throughput through July have, on average, over 10 years of dedication remaining.

  • Diamondback operates approximately 38% of the dedicated acreage and produced approximately 35% of the volumes on the system in 2019 through July.


Start of Elba Island LNG Production Approved by FERC

Kinder Morgan’s request to start production of liquefied natural gas at the Elba Island export facility has been approved by U.S. regulators. This facility is one of half a dozen in the United States beginning to produce LNG for export.

The Federal Energy Regulatory Commission approved Kinder Morgan’s request to “commence service for liquefaction and export activities” at the first train in a filing dated September 30th.

The facility is able to produce around 3 million tons per day of liquefied natural gas. Periodic delays since late last year have led to start-up problems and the company had to tweak the setup of its 10 trains.

In 2018, United States has exported 22 million tons per day of LNG and this year 26 million tons per day of LNG has been exported so far.


Cheyenne Connector Pipeline Gets Approval from FERC

The final approval for the construction of Tallgrass Energy's Cheyenne Connector pipeline was given by Federal Energy Regulatory Commission.

The 70-mile, large-diameter interstate natural gas pipeline will transport natural gas from Colorado's DJ Basin to Cheyenne, Wyoming for Midwest delivery via the company's Rockies Express Pipeline.

The pipeline project will move natural gas from processing facilities in Weld County, Colorado to the Rockies Express Pipeline Cheyenne Hub also known as REX Cheyenne Hub, near the Colorado/Wyoming border.

Tallgrass has estimated that the Cheyenne Connector will be in service in the first quarter of 2020 with an expected initial design capacity of 600 MMcf/d and potential room for expansion.

Using Cheyenne Connector, producers in the DJ Basin can access interconnected pipelines and local distribution systems at the REX Cheyenne Hub as well as interconnected systems downstream of REX that reach end-users in West markets, Midwest markets such as Chicago and Detroit, the Gulf Coast and Southeast.


Enbridge Mainline Contract Plan Halted

Enbridge’s plans to switch to longer-term contracts from monthly agreements on its Mainline pipeline system was stopped by Canada Energy Regulator. The regulators ceased Enbridge Inc., from auctioning the right to send crude oil through its Mainline pipeline system due to the “perception of abuse of Enbridge’s market power.” 

Until the regulator approves of the terms, Enbridge will not be allowed to offer contracted space on the Mainline to shippers. Several companies, including Suncor Energy, have been protesting Enbridge’s plans and wrote to Canada Energy Regulator in August, urging the regulator to intervene.

“The Commission has concerns regarding the fairness of Enbridge’s open season process and the perception of abuse of Enbridge’s market power,” the Canada Energy Regulator said.

“Enbridge remains committed to moving ahead with contract carriage on the Mainline and has strong support for our offering. We will evaluate this decision and the next steps that we will take towards implementing contract carriage,” Enbridge spokesman Jesse Semko said in a statement.

The nearly 3 million barrel per day Mainline is North America’s largest pipeline system and carries the bulk of Canadian crude oil exports to the United States.