This month, oil and natural gas liquids construction dominate the market as upstream companies turn more rigs from low-revenue gassy plays to seek high-commodity-priced liquids plays in the U.S.

For example, Chesapeake Energy Corp., "America's Champion of Natural Gas," announced the execution of definitive agreements to build the largest integrated midstream service complex in eastern Ohio. Through its wholly owned subsidiary, Chesapeake Midstream Development LP (CMD) the company entered into a partnership with M3 Midstream LLC and EV Energy Partners LP to develop a midstream services complex geared toward liquids. The infrastructure will process natural gas and natural gas liquids (NGL) in the liquids-rich Utica Shale play in eastern Ohio.

The project calls for gas gathering and compression facilities to be constructed and operated by CMD, as well as processing, NGL fractionation, loading and rail terminal facilities to be operated by Momentum.

A state-of-the-art cryogenic processing facility will be built in Columbiana County and have an initial capacity of 600 million cubic feet (MMcf) per day. NGLs will be delivered to a central NGL hub complex in Harrison County that will feature an initial NGL storage capacity of 870,000 barrels (bbl.) and fractionation capacity of 90,000 bbl. per day, as well as a substantial rail-loading facility.

The partnership plans to invest some $900 million during the next five years, with the majority of that spent during the first two years. The current ownership structure of the partnership is 59% by affiliates of CMD, 33% by Momentum and 8% by EVEP.

Total E&P USA, Inc., Chesapeake's 25% joint venture partner in the Utica Shale wet gas acreage, has an option to participate in the project, which might proportionately reduce the ownership of CMD affiliates and EVEP to 44% and 6%, respectively.

Significant engineering and procurement has already begun for the project. The first cryogenic processing and fractionation plants are scheduled to be in service by second-quarter 2013.

Another major liquids project is planned by Oneok Partners LP, which will build a 200,000 bbl. per day pipeline to deliver crude from North Dakota's rapidly expanding Bakken region to the Cushing, Oklahoma, oil-market hub. This is Oneok's first foray into crude transportation.

The company plans to invest up to $1.8 billion to build the 1,300-mile Bakken Crude Express Pipeline to move high-quality, light-sweet crude oil produced from tight oil deposits in North Dakota's Williston Basin by 2015.

The Bakken Crude Express Pipeline will run parallel to an NGL pipeline already under construction that will run from the Williston Basin in Montana to Colorado. The oil line will then run next to the Overland Pass Pipeline, in which Oneok has a 50% interest, from Colorado to Oklahoma.

Meanwhile, the reversal and expansion of Enterprise Products Partner LP's Seaway pipeline to take crude from Cushing to the coast by the end of May is the first major step toward alleviating the Midwest glut. Crude sold into the Gulf Coast fetches a hefty premium to oil sold at Cushing. Today, liquids rule.

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