2011-03-01-2011-02-22-2011-04-04
Bought midstream assets in AR Fayetteville & TX Granite Wash plays, consisting of a total 155 miles of gathering pipelines with capacity of approximately 510 MMcf/d, treating capacity of 165 MMcf'd, & a 36 MMcf/d cryogenic processing plant.
Houston-based Crestwood Midstream Partners LP (NYSE: CMLP) has completed the acquisition of certain midstream assets in the Fayetteville shale and the Granite Wash plays from Tulsa, Okla.-based, privately held Frontier Gas Services LLC for approximately $338 million in cash.
The acquired assets in the Fayetteville shale, in northwestern Arkansas, consist of approximately 127 miles of gathering pipelines with a capacity of approximately 510 million cubic feet per day, treating capacity of approximately 165 million cubic feet per day and approximately 35,000 horse power of compression serving dedicated acreage and natural gas production currently under contracts with BHP Billiton Petroleum, Houston, (NYSE: BHP), Houston-based BP America Inc., a subsidiary of BP Plc, London, (NYSE: BP) and Fort Worth, Texas-based XTO Energy Inc.
The Granite Wash assets, in the Texas Panhandle, include a 28-mile natural gas and natural gas liquids pipeline system and 36 million cubic feet per day cryogenic processing plant serving dedicated acreage and natural gas production currently under contracts with Chesapeake Energy Corp. and Linn Energy LLC. Crestwood LP plans to install a second processing plant with approximately 60 million cubic feet per day of additional capacity with plans to be in service by the end of 2011 to support expected growth in volumes from the emerging Granite Wash play.
"We are pleased to complete this important acquisition of high quality, midstream assets which are located in two of the nation's premier natural gas and natural gas liquids shale plays. This deal, coming on the heels of our October 2010 acquisition of Barnett shale midstream assets in North Texas, is evidence of our long-term strategy to expand Crestwood LP's geographic and operating footprint and diversify the partnership's customer portfolio to include some of the leading producers in the shale or unconventional resource development business," says Robert G. Phillips, president and chief executive of Crestwood LP's general partner.
"The Fayetteville shale, like the Barnett shale, is considered to be a world-class natural gas resource play and the Granite Wash is a fast-emerging shale play driven by significant natural gas liquids production," Phillips adds.
"Both of these new areas should provide Crestwood with solid near-term growth and numerous organic expansion opportunities in the future due to long-term acreage dedications associated with the producer contracts under the Frontier acquisition. Importantly, the Frontier assets fit well with our existing asset base and will be quickly integrated into Crestwood LP's Barnett shale operations during the second quarter of 2011."