Kinder Morgan Energy Partners (KMP) has signed a letter of intent with Targa Resources Partners to form a joint venture (JV) to build new natural gas liquids (NGL) fractionation facilities in Mont Belvieu, US.
The new NGL facilities will provide services for producers in the Utica and Marcellus Shale resource plays in Ohio, West Virginia and Pennsylvania.
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KMP natural gas liquids president Don Lindley said that the JV will provide NGL pipeline customers with a fully integrated NGL solution from the tailgate of their processing plants in Utica and Marcellus to the consumer of the purity products along the Gulf Coast.
“Targa’s market connectivity, storage, and expertise in fractionation and in LPG export infrastructure and services on the Gulf Coast may provide the Utica and Marcellus producers with maximum value and optionality at the largest NGL hub in the US,” Lindley added.
The binding open season, which is currently underway for the Utica Marcellus Texas Pipeline (UMTP), will be extended until 28 February 2014.
The UMTP will include the abandonment and conversion of over 1,000 miles of KMP’s existing Tennessee gas pipeline system. It will also include building around 200 miles of new pipeline from Natchitoches to Mont Belvieu for fractionation.
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By GlobalDataCurrently, the Tennessee gas pipeline system is in natural gas service from Mercer, Pennsylvania to Natchitoches, Louisiana.
The facilities will be situated next to Targa’s existing fractionation facilities at Mont Belvieu and will offer fractionation services for customers of UMTP of up to about 150,000 barrels per day (bpd). It will potentially serve up to 400,000 bpd of maximum pipeline capacity over time.
