All Pipes Lead To Permian

By North American Shale magazine staff | May 11, 2017

No shale play has received more new pipeline additions or new buildouts then the Permian this year. After waiting more than 18-months to find the right set of assets and storage terminals in West Texas, NuStar Energy LLP found its answer in Navigator Energy Services LLC. For $1.475 billion, NuStar was able to enter the Permian. “It has been no secret that we have been actively searching for a way to break into the Permian Basin,” said Brad Barron, president and CEO of NuStar. To pay for the Permian assets, NuStar intends to go to the equity and debt markets. It has also issued 12.5 million common units. Of the 16 producers already committed to ship-or-pay contracts, half are publicly traded and the other half are Permian pure-play producers.

Phillips 66 is also eyeing the Permian. The refining and logistics giant has announced plans for its Rodeo Project, a pipeline system originating in the Texas Counties of Reeves and Odessa. New injection and storage terminals will be built near Midland and Odessa, Texas. The system, set to be operational in 2018, could initially move up to 130,000 barrels of oil per day before eventually moving 450,000 barrels of oil per day.

Enterprise Products Partners LP may not be focused on piping oil, but the company has announced plans to build a 571-mile pipeline to move natural gas liquids from the Permian Basin to its NGL fractionation and storage complex in Mont Belvieu, Texas. “The Permian Basin is currently the hottest play in North America and is expected to continue its strong growth for years to come,” said A.J. Teague, Enterprise CEO. The pipeline will start in Gaines County, Texas, and initially hold a capacity of 250,000 barrels of NGLs per day. The project already has shipper commitment and could be in service in 2019.

Should the pipelines need next-generation tech for monitoring and inspection, a Canadian-based company has a purpose-built drone. SkyX, based in Toronto and led by a former Israeli Air Force captain, has built a vertical-take-off-and-landing drone specifically for the oil and gas industry. The system can fly for 70 minutes at 90 miles per hour. The SkyX can detect leaks, vandalism, vegetation encroachment and other potential problems.