A new natural gas processing facility will be established in the Delaware Basin by Enterprise Products Partners L.P. and Occidental Petroleum Corporation.
The two companies said on Thursday that they had signed an agreement to jointly develop a 150 million cubic feet per day (MMcf/d) cryogenic natural gas processing plant to accommodate the growing production of natural gas liquids (NGL)-rich natural gas in the Delaware Basin.
Enterprise will serve as construction manager and operator of the facility and it will be owned by a new 50/50 joint venture, Delaware Basin Gas Processing LLC ("Delaware Processing").
In addition to the processing plant, Enterprise will construct, own and operate a 12-inch diameter pipeline that will transport natural gas liquids from the new facility to one of the company's NGL pipelines. This will provide customers with access to its NGL fractionation and storage complex in Mont Belvieu, Texas. Enterprise's Texas Intrastate pipeline system will provide natural gas at the tailgate of the plant with access to multiple markets, the company said.
Long-term, firm contracts have already been agreed for the plant and it is expected to start operating in mid-2016.
"This new facility, combined with Enterprise's recently announced 200 MMcf/d cryogenic processing plant being built in Eddy County, New Mexico, reflects the company's commitment to providing producers in the Permian Basin with flow assurance and market choices. When completed, the two plants will increase Enterprise's net natural gas processing capacity in the Permian Basin to more than 600 MMcf/d," said A.J. "Jim" Teague, chief operating officer of Enterprise's general partner.