The new facility supplements existing infrastructure, and increases KUB-Gas’ overall processing capacity from 30 million cubic feet per day (MMcf/d) to 68 MMcf/d.
The company anticipates that gross daily production rates will increase by 5 MMcf/d or more from existing wells previously constrained by facility limitations, with further increases expected from the on-going drilling program. KUB-Gas is a partially-owned subsidiary in which Cub has a 30% ownership interest through its 30% shareholding of KUBGas Holdings.
The existing facilities in Makeevskoye were at capacity and insufficient to handle the increasing production resulting from KUB-Gas’ recent exploration and development success. By diverting some of the newer wells in Makeevskoye to the new plant, the Company anticipates benefits at both the Makeevskoye and Olgovskoye fields.
As system back pressures are reduced, existing wells should flow more freely. Gas began flowing through the new facility on March 6, 2014 and KUB-Gas intends to slowly increase the throughput rate in the new plant. This will allow stabilisation in the entire system at each step change until all the constrained production is on line.
Construction of the new Makeevskoye processing facility began in September 2013 and was completed in December 2013. Following completion of the new facility, there was a testing and commissioning period after which final operating approvals were received. The facilities were constructed and delivered on time and on budget at a cost of USD 7.8m (Cub net $2.3m).
