We Heard It Through the Pipeline

We Heard It Through the Pipeline

The state of Texas lays claim to the nation’s largest pipeline infrastructure at 479,798 miles. As a point of comparison, the circumference of Earth is about 24,901 miles. This means the amount of pipe sprawled beneath the surface of the Lone Star State alone could wrap around the globe more than 19 times. Those of us who run in midstream circles love sharing these kinds of impressive stats with friends and neighbors who try and picture just exactly how immense our national pipeline system really is. But in Texas, where everything is bigger right down to the chicken-fried steak, pipelines wear the coveted crown. Reese Energy Consulting today is studying the new updated report from the Texas Pipeline Association, which outlines the extraordinary economic benefits Texas pipelines generated in 2019. In short, of the 1,458 operators there contributing to $48.6 billion in overall economic impact, pipeline operations and construction accounted for 238,000+ high-paying jobs, $29.3 billion in gross state product, and an added infusion of $2.7+ billion in government revenues. We’re having a moment now.

What do you think?

Learn more about REC and our midstream services at www.ReeseEnergyConsulting.com.

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Sunset Over Petra Nova

Sunset Over Petra Nova

In hindsight, the $1 billion Petra Nova project seemed like a win-win: Create the world’s largest carbon capture facility next to one of the biggest power plants in Texas operating four coal-fired and four gas-powered units. Capture more than 90% of carbon dioxide from emissions produced in just one coal-fired unit. Pipeline the captured CO2 80 miles to an oilfield and boost production from 300 BPD to 4,000 BPD. What could possibly go wrong? Unfortunately for Houston-based NRG Energy, practically everything. After little more than three years, Petra Nova has been sunsetted indefinitely. When the plant worked, according to supporters, it worked as it was designed. But soon, mechanical problems and outages left it operational only one day in three. In the first few months this year, Petra Nova was operating at little more than 45.9% of capacity. Worse, the pandemic helped tank oil prices, demand, and crude oil output. Huge financial losses quickly followed. Petra Nova now has quietly suspended operations at the W.A. Parish Generating Station and lives to see another day when economic conditions improve

NRG Energy

NRG Energy, Inc. is a large American energy company, dual-headquartered in Princeton, New Jersey and Houston, Texas. It was formerly the wholesale arm of Northern States Power Company, which became Xcel Energy, but became independent in 2000. NRG Energy is involved in energy generation and retail electricity.

www.nrg.com

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Learn more about Reese Energy Consulting at www.ReeseEnergyConsulting.com.

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Midstreamers Announce Open Seasons

Midstreamers Announce Open Seasons

Dallas-based Navigator Energy has launched a binding open season for expansion of the company’s planned Borger Express Pipeline, which will extend from the Cushing Hub to Borger, Texas. The system will include an existing 180-mile crude oil pipeline and 200 miles of new pipe that will stretch from Cleo Springs, Okla., to Borger. Upon completion in early 2022, the Borger Express will be capable of transporting 90,000 BPD of five neat grades of crude oil and condensate bound for third-party storage facilities and a refinery in Borger. The call for shipper commitments runs from Oct. 5 – Nov. 5. Turning to the West, Dallas-based Holly Energy has announced a binding open season to expand crude oil capacity to 56,000 BPD on its 289-mile Frontier Aspen Pipeline. The Frontier Aspen, which runs from Casper, Wyo., to Frontier Station, Utah, connects to the company’s SLC Pipeline that ultimately delivers crude to Salt Lake City refiners. Commercial service is expected in 3Q 2021. Open season extends from Oct. 1 – Oct. 22.

Navigator Energy

Navigator Energy Services is a growth-oriented, independent midstream company focused on developing and delivering midstream infrastructure solutions for America’s energy producers. The company’s sole focus is to provide its customers with comprehensive midstream solutions that maximize both operational flexibility and the value of their hydrocarbons.

www.nesmidstream.com

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Learn more about Reese Energy Consulting and our range of midstream services at www.ReeseEnergyConsulting.com.​

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Pipelines Dangle New Carrots in Producer Deals

Pipelines Dangle New Carrots in Producer Deals

​Reviewing, evaluating, and negotiating contracts and agreements on behalf of producers and midstreamers has always been a big part of our business, but this year marks one the busiest as both parties adjust to the new-normal playing field. Shippers and midstream operators will always be codependent, with contracts and agreements between them to lock down the best rates and terms. When these are strategically negotiated, everyone wins. Producers get their supplies to the most lucrative markets and midstream operators earn their fees for processing and transporting those supplies. Then March happened and with it a confluence of fallout conditions that have resulted in pipelines offering fresh incentives for customers to stick with them. Sweeter terms, reduced rates upon contract renegotiation, and creative shipping options may be just the start. As negotiators, we know that preserving relationships is vital for both parties as they adapt and mutate in an uncertain environment for the benefit of each other. Interesting times for those of us on the bargaining end as the cards continue to shuffle.

What do you think?

Learn more about Reese Energy Consulting and our contract expertise at www.ReeseEnergyConsulting.com.

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