Oil & Gas News

Blue Mountain Considering More NatGas Processing to Serve Oklahoma’s STACK play

STACK

Linn Energy Inc. subsidiary Blue Mountain Midstream LLC has commissioned part of its Chisholm Trail III cryogenic processing plant in Grady County, OK, to serve growing natural gas production in the STACK  and now is considering another expansion.

Located near Tuttle, Okla., on Blue Mountain’s 80-acre site in Grady County, currently processing more than 100 MMcfd, the Chisholm Trail plant will be capable of processing up to initial-capacity level of 150 MMcfd in the coming weeks to meet producer demands, with the full 250 MMcfd to become available by fourth-quarter 2018 after installation of an additional 25,000 hp of compression, the operator said.

In response to rising throughput forecasts for the area—including existing producer commitments and anticipated production growth from Roan Resources LLC as well as other regional upstream producers—Blue Mountain is evaluating another expansion of the Chisholm Trail system that would include addition of a second 250-MMcfd train to increase total processing capacity at the site to 500 MMcfd by late 2019

Based on producer commitments and anticipated production growth from companies including Oklahoma pure-play Roan Resources LLC, which Linn and Citizen Energy II LLC formed last year Blue Mountain said Tuesday it may build another 250 MMcf/d train at the 80-acre site near Tuttle, OK, which could ultimately expand capacity to 500 MMcf/d by 2019.

Future expansion plans also could entail 55,000 hp of new compression, more than 130 miles of high and low-pressure gathering line extensions, and additional delivery interconnects in operation by yearend 2020, the company said.

“Blue Mountain’s customers continue to see exceptional drilling results, drilling efficiencies and are increasing their drilling activity,” CEO Greg Harper said. “In light of this, combined with our growing acreage commitments, throughput forecasts for the area continue to rise. In response, we will add processing capacity and access to downstream markets to stay ahead of our customers’ drilling schedules. This includes evaluating the addition of a second train expansion to the facility.”

The company said the new plant is currently processing more than 100 MMcf/d, which is expected to ramp to 150 MMcf/d in the coming weeks to meet producer demands. The facility also includes interconnections into the Southern Star Central, Enable Gas Transmission and Oneok Gas Transportation natural gas pipelines. Oneok Hydrocarbon is also providing natural gas liquids transportation from the facility.

The operator, however, did not disclose a timeframe for when it might reach final investment decision on the proposed system expansion.

Supported by a dedicated acreage position of more than 80,000 net acres under long-term contracts with natural gas producers in central Oklahoma, the Chisholm Trail system currently includes interconnections into the Southern Star Central, Enable Gas Transmission, and ONEOK Gas Transportation natural gas pipelines, with ONEOK Hydrocarbon also providing NGL transportation from the site.

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