midstream

Port of Lake Charles Commissioners approved an option for a long-term lease agreement on 90 acres with Magnolia LNG, an Australian-based energy company that plans to build a $2.2 billion export facility that will produce 4 million metric tons of LNG per year.

Strategy Engineering & Consulting LLC was awarded a contract by Chesapeake Energy to design a Central Production Facility (CPF) in the Eagle Ford Shale.

North Dakota crude oil production (including lease condensate) averaged an all-time high of 770,000 bpd in December. Total annual production more than doubled between 2010-12 in the Bakken Formation in the Williston Basin. North Dakota production in 2012 trailed only Texas and the U.S. Federal Offshore region, and the state accounted for 10% of total U.S. crude oil production.

Continental Resources Inc. has agreed to supply PBF with Bakken crude oil, which will be delivered by rail to PBF’s double-loop track at its refinery in Delaware City, DE.

The Eagle Ford Shale, stretching from the mid-south of Texas just shy of Corpus Christi north nearly to San Antonio and west to the Mexican border, continues to attract massive investments from energy companies. It’s not hard to see why. The play contains economically recoverable light crude oil and natural gas liquids in high proportion to currently low-priced gas.

Kinder Morgan Energy Partners L.P. (KMP) has completed the acquisition of 50% of El Paso Natural Gas Co. LLC (EPNG) and 50% of former El Paso Midstream assets in Utah and South Texas from Kinder Morgan Inc. The transaction is valued at $1.6 billion. KMP now owns 100% of both EPNG and the midstream assets.

Castleton Commodities International LLC (CCI) has acquired through subsidiaries the Paradox Basin midstream assets of Patara Oil & Gas LLC.

Kinder Morgan Energy Partners, L.P. is buying Copano Energy, L.L.C. for $5 billion. Copano, a midstream natural gas company with operations primarily in Texas, Oklahoma and Wyoming, provides services to natural gas producers, including natural gas gathering, processing, treating and natural gas liquids fractionation.

UGI Corp. and Tenaska Resources LLC will jointly develop gas resources in the Marcellus Shale in north-central Pennsylvania.

One issue still a hot topic for the Obama administration is whether to approve the second and final phase of the Keystone XL Pipeline. This will include another pipeline coming from Canada into the U.S. bringing another million barrels per day of tar sand crude oil also known as “diluted bitumen” to Gulf Coast refineries.

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