MarkWest and Energy & Minerals Group partner to develop $1bn gas gathering system

US-based companies MarkWest Energy Partners and the Energy & Minerals Group (EMG) are joining forces for the development of a $1bn gas gathering system.

With the development of the large-scale dry gas gathering system, the companies plan to expand their midstream position in the Utica Shale.

The system, which will initially take natural gas from northern Belmont and Jefferson counties, will be underpinned by a fee-based contract with Ascent Resources – Utica.

Under the terms of the agreement, Ascent has offered about 100,000 gross acres to the parties in northern Belmont and Jefferson counties, Ohio.

MarkWest Energy Partners chairman, president, and chief executive officer Frank Semple said: “The Utica Shale includes some of the most productive and economic dry gas acreage in the United States and producers are quickly capitalising on this tremendous opportunity.”

“We are very excited to continue our strong partnership with EMG to provide Ascent and others with a premier gathering system.”

“We are very excited to continue our strong partnership with EMG to provide Ascent and others with a premier gathering system, located in what may well be the most economic area of the Utica dry gas play.”

Designed to gather over two billion ft³ per day (Bcf/d) of gas from the prospective portion of the Utica’s dry gas window, the system could ultimately comprise more than 250 miles of pipeline and 200,000 horsepower of compression.

Initial operation from the system is expected to begin by the end of 2015.

The system is expected to offer various options including connections to the Ohio River System, a gathering trunkline project that can deliver gas to Rockies Express Pipeline (REX), Texas Eastern Transmission, ET Rover Pipeline, and other interstate pipelines.

“This significant dry gas gathering expansion in the Utica Shale is an example of the six to nine billion dollars of additional growth opportunities that we will have an even greater ability to deliver after consummation of the announced strategic combination with MPLX,” Semple added.