By: Carlabad Current-Argus – Two new natural gas processing facilities recently began service in the Permian Basin as companies seek to match the demand for gas management brought on by growing production in the region.
Enterprise Products Partners announced on July 18 its sixth gas plant began service on the eastern Midland sub-basin of the Permian, known as the Poseidon cryogenic natural gas processing plant in Glasscock County, Texas.
The plant opened with a processing capacity of 300 million cubic feet per day (cf/d) and can extract 40,000 barrels per day (bpd) of natural gas liquids (NGLs).
Poseidon increased Enterprise’s total gas processing capacity in the region to 1.3 billion cf/d and more than 185,000 bpd of NGL extraction, according to a company announcement.
Also in the Midland Basin, Enterprises’ Leonidas gas processing plant was expected to add another 300 million cf/d of processing and 40,000 bpd of NGL capacities when it begins service in early 2024.
In the western Delaware Basin, along Texas’ border with southeast New Mexico, the company also planned to expand its Mentone natural gas facility with a plant going into service by the end of 2023 and another in early 2024.
That will add 600 million cf/d of processing capacity and 80,000 bpd of NGL extraction.
Together, the Midland and Delaware basin projects will up Enterprise’s capacity to 3.8 billion cf/d of processing and 520,000 bpd of NGL extraction when complete, the announcement read.
Enterprise co-Chief Executive Officer A.J. Teague said the company’s efforts were intended to capitalize on continual growth projected in the Permian Basin for the “foreseeable future,” leading the company to invest about $3.8 billion in growth projects by the end of 2023.
“For the foreseeable future, the Permian Basin is expected to drive domestic production of crude oil, natural gas, and NGLs, and the expansion of our midstream network will support producers as they meet growing demand in the U.S. and internationally,” Teague said.
Also in the Midland sub-basin, Pinnacle Midstream announced plans to double the processing capacity at its Dos Picos Natural Gas System and an associated processing complex by the end of next year.
The expansion, which will add a processing plant to the existing facility, will increase capacity to about 200 million cf/d, growing Pinnacle’s total capacity to 440 million cf/d.
The company also planned to expand its gathering and compression facilities in Midland, Martin, and Glasscock counties to account for expected volume growth.
“This is an exciting next step for Pinnacle’s growing base of Midland Basin producers. Expanding the Dos Picos capacity by 220 MMcf/d ensures we can provide the best service to our current and future customers, maximize their recoveries, and help limit flaring across the basin,” said Pinnacle Chief Executive Officer Greg Sargent.
Chief Commercial Officer Drew Ward said the expanded facility will better aid Pinnacle in meeting the needs of its customers producing natural gas throughout the region.
“The extremely productive acreage being developed by our customers, as well as Dos Picos’ strategic Midland Basin location, ensure that we can provide the safest, most economical, and efficient options for our customers for many years to come,” he said.
The new facilities came as the Permian was expected to grow in natural gas production next month, according to a July 17 report from the Energy Information Administration.
The EIA forecast another 36 million cf/d would be produced in the Permian in August, the most growth of any other shale region, increasing total production to about 22.4 million cf/d.
That’s the second-most production of all other shale regions, the EIA reported, following about 35.3 million cf/d predicted in the Appalachia region which was expected to curb gas production by 16 million cf/d in the next month.
Oil production in the Permian Basin was expected to drop by 11 million bpd in August, the EIA forecast, but would maintain its lead spot in the U.S. with about 5.8 million bpd.
That decline in oil production followed reductions in oil and gas rig counts in Texas, which dropped eight rigs for its total of 329 as of Friday, according to Baker Hughes.
The Permian Basin in total lost five rigs for its total of 337, Baker Hughes reported.
New Mexico gained two rigs as of Friday, for its total of 113, records show.