Outrigger Energy II plans new DJ Basin midstream system

By Luke Geiver | April 16, 2018

Denver-based midstream services and development team Outrigger Energy is back in the shale game. The company, now operating as Outrigger Energy II announced plans to develop a tri-stream midstream system in the DJ Basin.

In January 2017, Outrigger Energy sold Permian Basin midstream assets to Targa Resources Corp. for $1.5 billion. Outrigger first began developing the Texas assets in 2014 when it entered the play by building and running wellhead gathering pipelines for natural gas, crude oil and produced water. The same year Outrigger began developing the Permian assets the company also received an equity commitment from Denham Capital.

The new DJ Basin assets will be situated in Weld County, Colorado and include wellhead natural gas gathering, a 60 mmcfd cryogenic processing plant, field compressor stations, crude oil gathering and produced water gathering. Through a long-term acreage dedication with Mallard Exploration, Outrigger will build, own and operate the new system. According to the midstream firm, there is already discussions taking place to expand the system.

“The DJ Basin continues to be one of the most prolific oil and gas resource basins in the country and members of the Outrigger team have spent significant time building and operating midstream systems here in the past,” said Dave Keanini, Outrigger CEO. “We couldn’t be more excited to return to the basin and provide a reliable, long-term midstream solution for area producers.”

According to the company, Outrigger has purchased a new cryogenic plant and has begun the permitting process with Weld County and the state of Colorado which will allow the system to be in service by early 2019. The processing plant will deliver residue gas to Cheyenne Plains Pipeline, a 36-inch diameter line that offers abundant access to both the Cheyenne Hub and to Mid-Continent markets, providing price and delivery advantages over other pipeline choices. NGLs will be delivered to the Overland Pass Pipeline operated by the Williams Companies and co-owned by ONEOK, Inc.  Multiple outlet opportunities exist for crude oil delivery, including Tallgrass’ Pony Express Pipeline system and NGL Energy’s Grand Mesa Pipeline system.