Natural Gas Business
East Texas System
In February 2009, we completed construction on our
Orange Texas Compressor Station, the last remaining
facility of our $655 million expansion and extension of
the East Texas System, referred to as the Clarity project.
The Clarity pipeline enables us to provide service
to major industrial companies in southeast Texas with
interconnects to interstate pipelines, intrastate pipelines
and wholesale customers. Clarity is positioned for potential
upstream and downstream expansions to meet the
growing demand for natural gas transportation capacity.
At the Longview facility, William McBride, plant operator,
left, and Pat Moran, plant supervisor, adjust a flow
controller on one of the solar turbines.
In the second quarter of 2009, we completed a $60 million
expansion project to add compression and approximately
26 miles of 20-inch diameter pipeline within our
East Texas System. The completed expansion provides
an additional 160 million cubic feet per day (MMcf/d)
of capacity for this growing region. We are undertaking
$180 million in expansions to provide gathering, treating
and transportation services to several producers in counties
west and south of Carthage, Texas.
The Bossier trend, located on the western side of our East
Texas System within the East Texas Basin, has seen a
significant drop in development with production falling
from 2,400 MMcf/d in March 2009 to 1,950 MMcf/d in
October 2009, partly due to the drop in natural gas prices.
However, this decreased drilling activity in the Bossier is
expected to be more than offset by the increased activity
focused in and around the Haynesville Shale, a formation
that runs from western Louisiana and into eastern
Texas, and has the potential of being one of the largest
natural gas discoveries in the United States. If proven, the
discovery could create more drilling activity around our
East Texas System, increasing the demand for our services.
The potential natural gas production in this region
exceeds 1 Bcf/d, primarily from Haynesville wells.
Our East Texas System comprises approximately 3,400
miles of natural gas gathering and transportation pipelines,
nine natural gas treating plants and seven natural
gas processing plants, including three hydrocarbon
dewpoint control facilities, or HCDP plants.