The extension will connect a newly discovered gas field, drilled on a shallow-depth structural feature covering over 20,000 acres, to a Northern Natural interstate pipeline.
MKGG will gather gas from third-party gas wells, which tested at combined rates exceeding four million cubic feet per day (MMcfd) and are expected to produce at settled rates of 3MMcfd. MKGG has signed a Percentage-of-Proceeds (POP) gas contract with the operator for these wells and all planned development wells. These wells should effectively double the gas throughput in the MKGG gathering systems. Eventually, gas from this field, as well as adjacent gas fields, will be committed to a cryogenic gas processing facility owned by MKGG and planned for installation in 2010. The plant will process the gas which contains a significant percentage of helium, a valuable, hard-to-find commodity.
Steven Moore, president of CKGG, commented, “The extension of our gathering system in Ellsworth County opens a new area for natural gas exploitation. The acreage along our gathering system is highly prospective for these shallow gas reservoirs and we are well placed to gather and sell these resources.”
