Williams and DCP Midstream Partners Announce First Gas from Ultra-Deepwater Gulf of Mexico Pipeline

abarrelfullabarrelfull wrote on 04 May 2015 16:50

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Feb. 9, 2015

Williams (NYSE: WMB), through its general partner ownership of Williams Partners (NYSE: WPZ), today announced with DCP Midstream Partners, LP (NYSE: DPM) that the new extended Discovery natural gas gathering pipeline system is now flowing natural gas. The Keathley Canyon ConnectorTM deepwater gas gathering pipeline system and the South Timbalier Block 283 junction platform are serving producers in the central ultra-deepwater Gulf of Mexico.

The 20-inch, 209 mile Keathley Canyon Connector, which is capable of gathering more than 400 million cubic feet per day (MMcf/d) of natural gas, originates in the southeast portion of the Keathley Canyon protraction area and terminates into Discovery’s 30-inch diameter mainline at Discovery’s new junction platform. The pipeline was constructed in depths of up to 7,200 feet of water approximately 300 miles south-southwest of New Orleans.

“Building a pipeline in challenging terrain at this depth is incredibly complex, and I applaud our project team for their commitment to completing the project in a safe, environmentally responsible and timely manner,” said Rory Miller senior vice president of Williams’ Atlantic-Gulf operating area. “True to our vision of developing smart, large-scale solutions to move gas to market, we’ve built a highly reliable and cost-effective connection from deepwater production to our onshore Larose gas processing plant and Paradis fractionator.”

The Keathley Canyon Connector extension is supported by long-term agreements with the Lucius and Hadrian South owners, as well as the Heidelberg and Hadrian North owners, for natural gas gathering, transportation and processing services for production from those fields. In addition, the new pipeline system is in proximity to other high-potential deepwater Gulf of Mexico discoveries and prospects.

“With the startup of the Keathley Canyon pipeline the Discovery joint venture is now ready to serve the growing production needs of our deepwater producers. As partners in the project, Williams and DPM are now positioned to significantly benefit from its world class deepwater gathering system,” said Bill Waldheim, President of DCP Midstream Partners. “This is a great fee-based asset which will generate strong distributable cash flows for DPM.”

In addition to the offshore gathering system, the Discovery system includes the 600 MMcf/d Larose natural gas processing plant providing market outlets to six interstate/intrastate gas pipelines and the 35,000 BBL/d Paradis fractionation facility.

Williams owns the controlling interest in and is the general partner of Williams Partners L.P., which owns 60 percent of the Discovery system and operates it. DCP Midstream Partners, LP owns the remaining 40 percent of the Discovery system.

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