Atlas Pipeline Partners, L.P. Announces Significant Expansion at WestTX Facility

abarrelfullabarrelfull wrote on 17 Nov 2011 07:42
Tags: atlas ngl pipeline usa

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Atlas Pipeline Partners, L.P. (NYSE: APL) (“APL”, “Atlas Pipeline”, or the “Partnership”) today announced plans to construct a new 200 MMCFD cryogenic processing plant to accommodate rapidly increasing Permian production. The new facility, to be known as the Driver plant, will be constructed in two phases, with the first phase involving construction of plant and associated compression to process 100 MMCFD, expected to be in service in the first quarter of 2013. The second phase, involving placement of additional compression and refrigeration equipment to increase the plant’s capacity to 200 MMCFD, is scheduled to be operational in the first quarter of 2015. The Partnership expects cash flows from the expansion to materialize in meaningful amounts during the second half of 2013.

Completion of both phases will increase processing capacity at WestTX from 255 MMCFD to 455 MMCFD. The total expected cost is estimated to be $200 million net to the Partnership, which includes both phases of the expansion and the all of expected compression and well connection costs. While a minor portion of the $200 million in capital spending will be well connections beyond the 2015 calendar year, the majority of the capital outlay for the project will be incurred evenly over the 2012-2015 period. Approximately $80-85 million is expected to be deployed over the 2012-2013 time period.

Atlas Pipeline’s partner on the WestTX system, Pioneer Natural Resources, Inc. (NYSE: PXD), which owns a 27.2% interest in the facility, will participate in the projects costs and cash flows and will anchor the production growth behind the expansion.

“We are excited to announce a significant 200 million cubic feet per day expansion at our West Texas facility. This expansion, the second announced expansion of this facility this year, is the result of increased activity in the Permian basin by our producer customers, including Pioneer, who is a partner on the system. We will continue to invest in our assets to serve our customers as opportunities arise to ensure we are the service provider of choice in the areas in which we operate,” stated Eugene N. Dubay, Chief Executive Officer of the Partnership.

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