Targa Resources To Build New Pipeline

April 13, 2018

INDUSTRY NEWS (Houston, TX) – Targa Resources Corp. announced recently that it has entered into long-term fee-based agreements with an investment grade energy company for natural gas gathering and processing services in the Delaware Basin and for downstream transportation, fractionation and other related services. The agreements with Targa are underpinned by the customer’s dedication of significant acreage within a large, well-defined area in the Delaware Basin.

 

The Company also announced an extension of its new common carrier natural gas liquids (“NGL”) pipeline currently under construction (“Grand Prix”) into southern Oklahoma. The pipeline expansion is underpinned by significant long-term commitments for both transportation and fractionation services from Targa’s existing and future processing plants in the Arkoma area in its SouthOK system and from third party commitments, including a significant long-term commitment for transportation and fractionation with Valiant Midstream, LLC (“Valiant”).

 

“We are very pleased to have entered into agreements to provide services across our integrated platform supported by a large acreage position held by a major Delaware Basin customer. This is a significant extension of our multi-plant, multi-system Delaware footprint, adding infrastructure through the core of the Delaware Basin. Also, the expansion of our Grand Prix NGL Pipeline into Oklahoma is an attractive extension of a highly strategic asset for Targa, enhancing the capabilities we can offer our existing and potential customers in southern Oklahoma,” said Joe Bob Perkins, Chief Executive Officer of the Company. “The investments are aligned with our strategic objectives of leveraging existing Targa infrastructure to further strengthen our competitive position from gathering and processing through transportation, fractionation and other related services to meet the infrastructure needs of our customers.”

 

Delaware Basin Processing Expansions

In the Delaware Basin, supported by the significant near-term volume growth expected on the dedicated acreage, Targa will construct approximately 220 miles of 12 to 24 inch high pressure rich gas gathering pipelines across some of the most prolific parts of the Delaware Basin, a new 250 million cubic feet per day (“MMcf/d”) cryogenic natural gas processing plant (the “Falcon Plant”) in the Delaware that is expected to begin operations in the fourth quarter of 2019, and a second 250 MMcf/d cryogenic natural gas processing plant (the “Peregrine Plant”) in the Delaware that is expected to begin operations in the second quarter of 2020. Total net growth capex related to the plants and high-pressure pipeline system is approximately $500 million, with approximately $200 million expected to be spent in 2018.

 

Targa will also provide NGL transportation services on Grand Prix and fractionation services at its Mont Belvieu complex for a majority of the NGLs from the Falcon and Peregrine plants.

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