National Fuel Grows Its Energy Empire

National Fuel Grows Its Energy Empire

N.Y.-based National Fuel Resources has once again diversified its midstream capabilities with the acquisition of a crude oil terminal in Gibson, La., by the company’s Empire Pipeline subsidiary. Previously owned and operated by Equilon (Shell Oil Products and Shell Oil Co.), the new assets mark Empire’s first entry into crude oil terminalling—an area it plans to grow through future acquisitions.

National Fuel Reources

National Fuel Resources, Inc. (NFR) is among the largest non-utility suppliers of natural gas in this region. For more than 25 years, NFR has been helping businesses in New York and Pennsylvania with their natural gas costs.

www.nfrinc.com

Located in Terrebonne Parish near the Intracoastal Waterway, the Gibson Terminal offers 300,000 barrels of tank storage along with barge loading and unloading and a truck receiving station. The facility handles sweet and sour crude from the Eagle Ford, Permian, and Bakken via the Ship Shoal Pipeline System, the Atchafalaya Pipeline, and the Magellan Pipeline. Empire says it also plans to build a bi-directional pipeline connection to Shell’s 350-mile Zydeco pipeline.

National Fuel in May acquired Shell’s upstream and midstream gathering assets in Pa., for $541 million. The transaction included 200,000 acres in Tioga County, with net proved developed gas reserves of approximately 710 BCF, 142 miles of gathering pipe, and more than 100 miles of water pipelines—all of which support the production operations.

National Fuel’s business segments include a natural gas utility, exploration and production, natural gas transportation pipelines and storage, and natural gas gathering.

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The Money Backers:  Warburg Pincus

The Money Backers: Warburg Pincus

In RMR’s continuing series The Money Backers, we give readers a glimpse of who’s who and who owns what in energy’s private equity world.  From the largest to the smallest to the newest, we look especially at those firms making hay in the midstream industry to provide the capital infusion required to give growth projects liftoff.

Warburg Pincus

Warburg Pincus LLC is a New York-based private equity firm focused on growth investing with offices in the United States, Europe, Brazil, China, Southeast Asia and India. It has been a private equity investor since 1966.

www.warburgpincus.com

With more than $54 billion in managed assets, global powerhouse Warburg Pincus spreads its investment wealth across seven industries that range from retail diamonds in India to real estate across Asia. This private equity firm also counts energy as a primary focal point with 31 portfolio companies in the upstream, midstream, downstream, electrical power and renewables sectors. Since the late 80s, Warburg Pincus has invested or committed $10+ billion in energy-related companies and infrastructure projects around the world.

In the U.S. midstream space, WP banks on natural gas and Navitas Midstream. Based in The Woodlands, Texas, Navitas operates more than 1,800 miles of gas gathering pipelines and five cryogenic gas processing trains in the Permian Basin. Through newbuilds and acquisitions, Navitas in less than six years has created one of the Permian’s busiest midstream complexes serving the Midland. The company in 2019 completed its latest gathering project in southern Glasscock and northern Reagan counties that includes 34 miles of pipe with 200+ MMCFD of capacity and 25,000+ hp of three-stage field compression.

Warburg Pincus’ upstream investments in the U.S. include Antero Resources (Marcellus and Utica), Chisholm Energy (Permian, northern Delaware),  Ensign Natural Resources (Permian, South Texas), Hawkwood Energy (Rockies and Mid-Continent), Independence Resources Management (Permian, Anadarko), and Laredo Petroleum (Permian, Mid-Continent).

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Moda Midstream Adds Crude Storage

Moda Midstream Adds Crude Storage

Let’s give a hallelujah moment to Houston-based Moda Midstream, which has announced completion of the last 495,000 Bbls crude oil storage tank at the company’s Midstream Ingleside Energy Center (MIEC) on the Texas Gulf Coast. This latest news lifts MIEC’s capacity to 10 MMBbls. And that sounds mighty good right now.

Moda Midstream

Moda Midstream LLC is a liquids terminaling and logistics company that provides independent terminal, storage and distribution solutions to refiners, petrochemical manufacturers, marketers and producers of crude oil, condensate, NGLs, refined products and other bulk liquids.

www.modamidstream.com

But there’s no rest for the weary in a time of hyper storage shortage. Moda reports construction now has begun on another expansion of MIEC to onboard an additional 3.5 MMBbls of crude oil, bringing the company’s total capacity that includes its Taft Terminal to 15.5 MMBbls. Service on the latest expansion is expected to go online by year end.

And Moda isn’t stopping there. The company says it now has obtained permits and is in talks with customers to add even more storage at both terminals. Moda operates one of the largest crude oil export facilities along the Gulf Coast with pipeline connectivity to the Cactus I and II, Phillips’ Gray Oak, EPIC, and other pipelines bound for southern destinations, flowing approximately 2.5 MMBPD of Permian and Eagle Ford crude. Operating three gulf terminals, Moda Midstream literally transformed a former naval base, now MIEC, into an export hub accommodating supertankers.

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See also: THE MATTER OF CRUDE OIL STORAGE; NUSTAR GETS A MONEY BOOST

 

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News You Can Use

News You Can Use

RMR is featuring the latest high-point news to keep you up to date with activities happening in the basins and shale plays that matter to you most.

Consolidation Continues its Drumbeat

Tulsa, Okla.-based Empire Petroleum Corp. has been rather busy the last couple of years, snatching up oil and gas assets in N.D. and Mont., that join the company’s La., and Texas Panhandle upstream footprint. The company recently announced its latest acquisition of Fort Worth-based Pardus Oil and Gas that includes East Texas oil and gas acreage and midstream operations located in Houston, Madison, and Leon Counties. The transaction comes with 139 oil and gas wells across 30,397 acres in the northeast Eagle Ford producing more than 400 BOED,  and 77 miles of gathering pipelines in the Ft. Trinidad Field, which the company says affords ample surplus capacity to accommodate future growth in the area.

 

Continental Says Huh-uh

Harold Hamm, CEO of Okla. City-based Continental Resources, ain’t havin’ it folks following the cliff-dive of crude oil prices April 20. The larger-than-life oilman prodigy has asked for an investigation of crude oil futures for possible market manipulation, failed systems or computer programming failures upending the oil industry, citing “The unprecedented, historical event of WTI crude oil trading at negative prices for the first time in history and the circumstances surrounding the trading shows the system failed, negatively impacting a significant part of the American Economy.”

 

 Texas Railroad Commission Says Huh-uh

In a five-week battle between oil and gas producers looking to continue operations vs those hollering to halt production in the epicenter of the nation’s oil industry, the Texas Railroad Commission has punted the ball to May 5. This to determine whether production should be pro-rated (cut) from the mighty Permian while jobs and E&Ps hang by a thread. Okla., and N.D., will face similar hearings next month. All this while proponents argue that given bottom-out oil prices could bankrupt independent producers while the big boys take the reigns of our oil economy.

The planets have realigned in a most curious way we’re not accustomed to. We’re now feverishly looking at offshore terminals, tanker ships, rail cars, plug-and-play storage tanks and Dad’s ’72 station wagon to house all this oil until the nation gets back on the road again.

 

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Crude Oil Storage Hits a Premium

Crude Oil Storage Hits a Premium

All dressed up and nowhere to go.

That best sums up the latest dilemma crude oil producers face as storage capacity grows more strained by the week. In response, the federal government has said “fill ‘er up” at the U.S. Strategic Petroleum Reserve, making available an initial 30 MMBbls of crude storage to be followed by another 47 MMbls of capacity, to help E&Ps find their supplies a place to land. At least for now.

Midstreamers who operate storage facilities and tank farms also are stepping up to the challenge to address the urgency among their pipeline shippers. Houston-based Phillips 66, whose Gray Oak Pipeline system began initial service late last year, just announced it will “modify its rules and regulations to accommodate on-system crude storage.” The 850-mile, 900 MBPD Gray Oak extends from the West Texas Permian and Eagle Ford to Corpus Christi and is expected to offer full service this month. Phillips says it will offer ancillary storage for Gray Oak pipeline shippers flowing WTI and WTL grades of crude oil at the company’s 1 MMBbl storage and export terminal on the Texas Gulf Coast. We’re projecting more pipelines soon will follow suit if they haven’t already.

The perfect storm our oil and gas industry finds itself in with this latest punch to the solar plexus is driving producers to consider storing their barrels in rail cars and floating storage via offshore marine vessels. Crude oil storage now has become the new black gold to hold black gold, and increasingly scarcer than a Pandemic cure. When there are no quick buyers, there are no quick answers to a predicament felt the world over amid rising production and bottomed-out demand.

As calls by some of the nation’s largest independent E&Ps grow louder to cut or even halt production—at least until the biggest thunderhead has clapped in this storm—the lack of storage may very well be the final about-face to rethink our industry after the clouds have parted.

What do you think?

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