Enterprise Products Partners has entered into 10-year agreements with Pioneer Natural Resources, Reliance Eagleford Upstream Holding and Newpek (collectively, the Pioneer JV) to provide midstream services in Eagle Ford Shale.
Enterprise will provide the midstream energy services to handle liquid-rich natural gas and crude oil production from the Pioneer JV’s acreage in the Eagle Ford Shale play in south Texas.
The agreements cover a significant portion of the Pioneer JV’s expected Eagle Ford Shale production, including commitments for firm natural gas transportation, natural gas processing, natural gas liquid (NGL) fractionation and transportation services and crude oil marketing.
The Pioneer JV’s NGL-rich natural gas will initially be processed using Enterprise’s existing US Gulf Coast facilities until it can be processed at the company’s natural gas processing plant that is under development in south Texas.
This cryogenic facility is designed for an initial capacity of 600 million cubic feet per day (mmcf/d) and initially will have the capability to extract as much as 60,000 barrels per day (bpd) of NGLs.
The Pioneer JV’s NGL production will ultimately be transported on Enterprise’s new 127-mile NGL pipeline that will extend from the new natural gas processing plant to the company’s complex at Mont Belvieu, Texas.
The new NGL pipeline will have an initial capacity of more than 60,000bpd, which can be readily expandable to over 120,000bpd, and is scheduled for completion in early 2012.
As part of the crude oil agreements, Enterprise will construct approximately 100 miles of supply laterals that will deliver crude oil production from the Pioneer JV into the new 140-mile pipeline the company announced earlier this year.
The Pioneer JV’s producing area in the Eagle Ford Shale currently covers over 300,000 gross acres in McMullen, Atascosa, Live Oak, Bee, Karnes and DeWitt counties.
The gathering lines required to link the producing wells to Enterprise’s midstream assets will be provided by EFS Midstream, a joint venture between Pioneer and Reliance.