Report Volume XXIII, Number 6, November 15th, 2011

INDUSTRY NEWS (Kaufman, TX) – Larrett Energy Services, Inc. is expanding its operations to the South Texas Eagle Ford Shale. Larrett will be opening a new 35 acre office, shop and lay down yard at 12048 Hwy 83 in Asherton TX. The facility expansion is to meet the growing customer demand for Larrett to a have a presence in the area. Construction should be complete by December of 2011 with operations in the area beginning immediately.

Larrett Energy which is headquartered in Dallas, Tx has concentrated it’s resources in the Barnett Shale and the installation of the urban pipelines. Larrett Energy also operates a pipeline maintenance division that operates in the states of Texas, Oklahoma and Louisiana. The growth the company has seen it is first year in the Barnett Shale region and its growing customer base is leading the company to expand to the Eagle Ford Shale.

INDUSTRY NEWS (Bismark, ND) – Montana-Dakota Utilities Co. intends to build a 24-mile natural gas pipeline to fuel a proposed 88-megawatt natural gas-fired power plant near the company’s Heskett Generating Station.

MDU announced in July plans to build an $85.6 million natural gas-fired power plant next to its coal-fired plant to meet capacity requirements following the failure of the planned Big Stone II coal plant in South Dakota in 2009. If approved, the new plant could be in use by the beginning of 2015. On Oct. 24, the Bismarck- based company submitted to the North Dakota Public Service Commission a letter of intent to file an application for a certificate of corridor compatibility and route permit for the proposed pipeline to feed the plant. The 10-inch pipeline would cost an estimated $18.4 million and would have a maximum pressure of 1,440 pounds per square inch.

The pipeline would run from a new town border station to be installed on Northern Border Pipeline Co.’s system near St. Anthony, southwest of Mandan, to the Heskett Station north of Mandan.Montana-Dakota Utilities Co. hopes to start construction on the pipeline in mid-2013 and finish it that year.

INDUSTRY NEWS (Houston, TX) – Enterprise Products Partners L.P. recently announced several new construction projects that will extend and expand its natural gas and natural gas liquids (”NGL”) infrastructure in South Texas to accommodate expected production growth from the Eagle Ford Shale play. As a result of additional demand from our Eagle Ford producing customers, along with the execution of new gathering and processing agreements, Enterprise will build an additional 300 million cubic feet per day (”MMcf/d”) train at its Yoakum cryogenic natural gas processing facility in Lavaca County, Texas.

In addition, the partnership is constructing 62 miles of 24-inch diameter and 30-inch diameter pipeline loops and increasing horsepower compression to gather, and transport an additional 300 MMcf/d of rich Eagle Ford Shale gas. This expansion is expected to begin service in the first quarter of 2013. Approximately 195 rigs are presently working in the play as of the end of the third quarter 2011, compared to approximately 105 rigs in the third quarter of 2010.

“Increased drilling activity in the prolific Eagle Ford Shale continues to create opportunities for Enterprise to leverage its integrated network of midstream assets to provide producers with flow assurance and market choice,” said A.J. “Jim” Teague, executive vice president and chief operating officer of Enterprise’s general partner. “Each new addition to our growing infrastructure footprint allows us to provide enhanced service options for customers in a more efficient, timely and cost-effective manner.”

As previously announced, Enterprise is currently constructing its Eagle Ford rich natural gas mainline system and associated laterals consisting of approximately 300 miles of pipeline, representing gathering and transportation capacity of more than 600 MMcf/d. The Yoakum natural gas processing facility currently has 600 MMcf/d of capacity under construction, which is expected to begin service during the second quarter of 2012. With the additional 300 MMcf/d train, the plant will have total capacity of 900 MMcf/d when service begins, which is expected in the first quarter of 2013.

INDUSTRY NEWS (Tulsa, OK) – Magellan Midstream Partners, L.P. announced recently that it is further expanding its crude oil pipeline distribution capabilities in the Houston area to deliver domestic crude oil and condensate transported via thirdparty pipeline systems from the Eagle Ford Shale production area directly to local refineries. The project includes the construction of a 6-mile, 24-inch diameter crude oil pipeline between the pipeline interchanges of Genoa Junction and Speed Junction, which will connect to the 24- inch diameter crude oil pipeline along the Houston Ship Channel that was previously announced as part of the partnership’s Houston-to-El Paso pipeline reversal project, allowing Magellan to further distribute product to the Houston-area refineries.

“Magellan’s crude oil infrastructure is strategically positioned to be the last leg distribution conduit to the Houston and Texas City refinery gate for growing domestic crude oil and condensate production,” said Michael Mears, chief executive officer. “Together with our recentlyannounced capital investment to transport crude oil from West Texas to the Houston market, Magellan will be able to access and distribute crude oil and condensate from both the Eagle Ford Shale and Permian Basin formations, providing Houston and Texas City refineries with direct access to new domestic production.” This project, which is supported by a long-term customer commitment, is expected to be operational by the end of 2012.