CHANNAHON, IL and DALLAS, Sept. 16, 2013 /CNW/ - Aux Sable Midstream, LLC ("ASM") and Summit Midstream Partners, LP ("SMLP") (NYSE: SMLP) are pleased to announce the execution of a new, long-term gas purchase agreement for liquids rich natural gas gathered on SMLP's Bison gathering system. The rich natural gas will be conditioned at ASM's Palermo Plant and then transported via ASM's Prairie Rose Pipeline and the Alliance Pipeline for processing at Aux Sable Liquid Products LP's ("ASLP") Channahon, Illinois 2,100 million cubic feet per day (mmcfd) natural gas liquids extraction and fractionation facility.
Under the agreement, SMLP will dedicate gas gathered from their Bison gathering system in Burke and Mountrail counties to ASM up to 25 mmcfd with options to increase volumes as they develop.
"We are very pleased to have reached this agreement with SMLP and look forward to growing the volumes that SMLP gathers for Bakken producers and Aux Sable moves to markets through world scale facilities. This agreement is consistent with our long-term strategy of providing Bakken producers with reliable and competitive market access for their rich natural gas that might otherwise be flared or less efficiently handled through field facilities" said W. J. (Bill) McAdam, President and Chief Executive Officer of Aux Sable.
Steve Newby, President and CEO of SMLP commented, "We are excited about expanding our relationship with Aux Sable, a premier midstream operator with large-scale natural gas processing assets. This agreement ensures that we have dedicated and scalable processing capacity available for our Bakken Shale customers over a long-term period. It also allows us to immediately offer our existing and future customers improved natural gas processing economics for their rich associated natural gas production."
North Dakota Governor Jack Dalrymple commented, "We must continue making progress in the gathering and processing of natural gas in western North Dakota. Aux Sable and Summit Midstream are playing an important role in our ongoing effort to reduce flaring and add value to our energy resources."
About Aux Sable
For over twelve years, Aux Sable has delivered outstanding safety, environmental and operating results. The company now has operations in several locations in the United States and Canada.
Aux Sable USA
Aux Sable Liquid Products owns and operates one of the largest NGL extraction and fractionation plants in North America. The facility is located in Channahon, Illinois about 50 miles southwest of Chicago near the eastern terminus of the Alliance pipeline. The facility is capable of processing 2,100 mmcfd of gas and can produce about 102,000 barrels per day of specification NGL products. All of the Alliance gas is processed at the Channahon NGL Facility where Aux Sable has shipper contracts to extract the NGLs.
Aux Sable Midstream owns and operates the Palermo Conditioning Plant and the Prairie Rose Pipeline. The Prairie Rose Pipeline connects the Palermo Conditioning Plant to the Alliance Pipeline, which delivers high energy dense phase gas to Aux Sable's Channahon, Illinois Plant for NGL extraction and processing. ASM is pursuing other NGL processing and infrastructure midstream initiatives, primarily driven by the shale oil and shale gas developments in the Midwest and northeast United States.
Aux Sable Liquid Products and Aux Sable Midstream are both owned by Enbridge (42.7% equity interest), Veresen (42.7% equity interest) and Williams Partners (14.6% equity interest).
Aux Sable Canada
Aux Sable Canada is an active midstream gas processing company in Western Canada, primarily along the Alliance Pipeline corridor. Utilizing transportation on the Alliance dense phase gas pipeline, ASC provides value added solutions for producers to effectively develop and produce NGL rich gas reserves. Since inception, the company has successfully attracted rich gas to Alliance through inducements and new rich gas connections. ASC's strategy also includes building, owning and operating offgas processing facilities for the heavy oil upgrading and refining industry in Alberta.
Aux Sable Canada is owned by Enbridge (50% equity interest) and Veresen (50% equity interest). Enbridge and Veresen each own a 50% interest in the Alliance Pipeline.
About Summit Midstream Partners, LP
SMLP is a growth-oriented limited partnership focused on owning and operating midstream energy infrastructure assets that are strategically located in the core producing areas of unconventional resource basins, primarily shale formations, in North America. SMLP currently provides primarily fee-based natural gas gathering and compression services in four unconventional resource basins: (i) the Piceance Basin, which includes the Mesaverde formation as well as the Mancos and Niobrara shale formations in western Colorado; (ii) the Fort Worth Basin, which includes the Barnett Shale formation in north-central Texas; (iii) the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota; and (iv) the Appalachian Basin, which includes the Marcellus Shale formation in northern West Virginia. SMLP owns and operates 757 miles of pipeline and 181,200 horsepower of compression. SMLP is headquartered in Dallas, TX with offices in Houston, TX, Denver, CO and Atlanta, GA.
Image with caption: "Aux Sable Midstream and Summit Midstream Partners, LP Announce New Gas Purchase Agreement (CNW Group/Aux Sable Canada LP)". Image available at: http://photos.newswire.ca/images/download/20130916_C7537_PHOTO_EN_30892.jpg
SOURCE: Aux Sable Canada LP
For further information:
Aux Sable US
Scott A. Seibert
Government & Public Affairs Manager
Summit Midstream Partners, LP
Vice President & Treasurer