These systems are located in Northwest Louisiana and East Texas and gather natural gas produced from the Haynesville/Bossier shales and the Cotton Valley and Taylor Sands formations.
The State Line system is located in Desoto and Caddo Parishes, Louisiana and Panola County, Texas. The system includes 138 miles of natural gas pipelines with a capacity of approximately 400 million cubic feet per day (mmcfd) and two treating facilities. The system began operations in February 2009 and is currently gathering approximately 260mmcfd.
A 50-mile expansion of this system is expected to be completed in June 2010 and will increase its capacity to 700mmcfd. The State Line system is supported by long-term acreage dedications and volumetric commitments from producers, the company said.
The State Line system will interconnect with the 42-inch Haynesville Extension of Enterprise’s Acadian natural gas pipeline system. The Haynesville Extension is currently under construction and expected to be completed in the third quarter of 2011. Once connected to the Haynesville Extension, the State Line system can be further expanded to 1.2 billion cubic feet per day for a nominal cost.
The Fairplay system is located in Rusk, Panola, Gregg and Nacogdoches counties, Texas. The system includes 249 miles of natural gas pipelines (including approximately 62 miles leased from third parties) with a capacity of approximately 285mmcfd, and is currently gathering approximately 180mmcfd. This system is expected to be connected to the Enterprise Texas Pipeline system by the first quarter of 2011. It is also supported by long-term acreage dedications and volumetric commitments from producers.
Completion of the transaction is subject to customary regulatory approvals, including those under the Hart-Scott-Rodino Antitrust Improvements Act, and other customary closing conditions. The transaction is expected to close in early May 2010.
