New Natural Gas Processing & Pipelines for Eagle Ford

$240 million joint venture for new Eagle Ford natural gas system
$240 million joint venture for new Eagle Ford natural gas system

A new natural gas processing system is planned for the Eagle Ford as two major players announced Monday they have formed a $240 joint venture for the project.

Related: Downsizing in the Eagle Ford

The new venture will partner one of the largest independent midstream energy companies in North America, Targa Resources Partners LP, with Sanchez' exploration and production division at a cost of $240 million. The pair will be equal partners and plan to construct a new 200 million cubic feet per day cryogenic natural gas processing plant in La Salle County, Texas along with approximately 45 miles of associated pipelines.

Improving Targa’s presence and performance in the Eagle Ford has been a focus since we completed our acquisition and entered the area earlier this year.
— Targa CEO, Joe Bob Perkins

The La Salle County Plant will be constructed to accommodate production from Sanchez Energy's Eagle Ford Shale acreage position in Dimmit, La Salle and Webb Counties and from other third party producers. Targa will manage construction and operations of the plant and high pressure gathering lines, and the plant is expected to begin operations in early 2017.

Sanchez confirmed last week that they will sell approximately 150 miles of midstream gathering lines and associated midstream infrastructure in the Eagle Ford in order to gain $345 million in cash. Sanchez Production Partners will acquire and operate the assets concentrated in four gathering and processing facilities.