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Summit Midstream signs shipper, prefiles at FERC for Delaware Basin gas pipeline

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Essential Energy Insights - January 2021


Summit Midstream signs shipper, prefiles at FERC for Delaware Basin gas pipeline

Summit Midstream Partners LP signed an Exxon Mobil Corp. subsidiary as a firm shipper on its proposed Double E pipeline and launched the federal pre-review process for the project that would connect producers in the Delaware Basin region to the Waha Hub in West Texas.

In a July 25 letter, Summit Permian Transmission LLC requested that the Federal Energy Regulatory Commission consider the Double E pipeline project in a prefiling process that occurs before the formal application. Summit Permian estimated it will file the formal application in February 2019. It hopes to receive a certificate order under the Natural Gas Act from the commission in February 2020, which would allow construction to begin in April 2020 and meet an in-service date of April 2021.

The project would initially carry approximately 1.3 Bcf/d, although the developer sees the potential for expansion up to 1.8 Bcf/d with compression. Summit Permian said the project would provide southeast New Mexico and northwest Texas producers with access to the Waha Hub, and from there gas could be transported by existing interstate pipelines.

The project would consist of approximately 117 miles of 30-inch and 42-inch-diameter "trunk-line," running from Eddy County, N.M., through Loving, Ward and Reeves counties in Texas, ending at the Waha Hub. Other project facilities would include a new compressor station and a 17-mile lateral pipeline, both in Eddy County. (FERC docket PF18-6)

Exxon unit XTO Energy Inc. has committed to firm transportation capacity on the Double E pipeline under a 10-year take-or-pay firm transportation agreement, which increases to 500,000 Dth/d.

Exxon, or any affiliate of Exxon, was given the right to become an equity partner in Double E as part of the deal, according to a July 27 news release.

Summit Midstream also plans to launch another open season in August for 500,000 Dth/d of additional capacity on the pipeline. Following the end of the planned open season, Summit Midstream intends to finalize the project's scope, cost estimate and timeline. The partnership also reaffirmed its intention for the pipeline to have a capacity of about 1 Bcf/d.

Summit Midstream launched an open season for the pipeline Jan. 29.